Dollar Tree said Thursday it is cutting 370 jobs at the former corporate headquarters of Matthews-based Family Dollar Stores, the rival discount retailer it acquired last year.
Chesapeake, Va.-based Dollar Tree kept a Family Dollar support center in Matthews after closing the $9.1 billion deal, but analysts had long expected the retailer would trim jobs to reduce costs.
On Thursday, the company said the layoffs were part of an effort to eliminate redundancies in its support functions. Dollar Tree had previously said it planned to reduce the combined company’s annual expenses by $300 million over three years.
Dollar Tree did not say Thursday how many employees worked at the Matthews location, but as recently as January the company had said it was around 1,200. The retailer said 100 of the jobs being eliminated were already vacant.
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The cuts do not affect individual store operations and merchandising functions, Dollar Tree said.
“These difficult but necessary actions will enhance our ability to efficiently support our businesses, while achieving our stated synergy targets,” Dollar Tree CEO Bob Sasser said in a statement.
The company has continued operating stores under the Dollar Tree and Family Dollar brand names, and Sasser said Thursday the company will continue to do so.
Family Dollar spokeswoman Bryn Winburn said the company is “fully committed to treating impacted associates in a professional and respectful manner and helping them through this transition.”
Thursday’s announcement comes one day after Dollar Tree said it’s moving forward with a plan to develop 70 acres at its headquarters in Chesapeake. The plan, first announced in 2013, was put on pause during the acquisition process. Dollar Tree said the additional space will allow it to expand by at least 100 new jobs a year over the next six years.
“Chesapeake will be our center of growth for services shared across the entire corporation,” Dollar Tree spokesman Randy Guilar said in an email.
Dollar Tree said to cover severance-related costs, it expects to incur pre-tax expenses of about $6 million this year.
Earlier this year, Howard Levine stepped down as Family Dollar’s CEO, drawing to a close nearly five decades of family executive leadership at one of Charlotte’s best-known corporations.
According to a securities filing in October 2014, Levine was eligible to receive “golden parachute” payments of up to $12 million, including $5.3 million in cash and $6.7 million in stock, as part of the merger. The filing cautioned that the amount was an estimate and could change.
Layoffs were happening even before Family Dollar sold itself. Amid the sluggish economic recovery in early 2014, for example, the company announced a plan to lay off 135 workers at its headquarters offices.
And in January 2015, Levine said the company was losing employees who were leaving on their own amid uncertainty over the company’s future. Those departures came amid a corporate takeover battle for Family Dollar that ultimately saw Dollar Tree prevail over rival Dollar General in a prolonged bidding war.