Dollar Tree has made a deal to sell Family Dollar, the bargain store chain that was founded in North Carolina nearly 70 years ago.
The $1 billion sale announced Wednesday comes a decade after Dollar Tree bought Family Dollar for $8 billion.
Dollar Tree has struggled to incorporate Family Dollar into its business. The company said last year it would close nearly 600 Family Dollar stores. The first Family Dollar opened in Charlotte in 1959.
Neil Saunders, managing director of GlobalData, said that after acquiring the rival chain, Dollar Tree struggled with supply chain issues, poor store locations and other operational difficulties.
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In Dollar Tree's earnings call Wednesday morning, CEO Mike Creedon said the sale would allow Dollar Tree to focus on its core business.
"Dollar Tree and Family Dollar are two different businesses with limited synergies and each is at a very different stage of its journey," Creedon said. "Separating them will enable each banner to be led and managed by a dedicated team that can focus exclusively on that banner's distinct needs."
The firms taking over Family Dollar, Brigade Capital Management and Macellum Capital Management, say they intend to grow the business as a private company.
"This transaction presented a unique opportunity to play a key role in reinvigorating an iconic business," said Jonathan Duskin, CEO and Partner of Macellum.
Dollar Tree expects to close the deal later in the second quarter.
The Associated Press contributed to this report.
