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McClatchy-Tribune  09/04/2014 12:01 AM ET
NC commerce chief could face 'awkward' vote on Family Dollar buyout [The Charlotte Observer :: ]

Sept. 04--Family Dollar's board of directors could soon face a tough decision, choosing between rival offers from firms seeking to buy the Matthews-based retail chain.

Perhaps no board member will face a tougher choice than N.C. Commerce Secretary Sharon Decker, who has served on the Family Dollar board since 1999.

As the state's top job recruiter, her role is to grow jobs in North Carolina. But as a board member, she owes a duty to Family Dollar shareholders to give them the best return on their investment.

And that might mean a vote for Tennessee-based Dollar General's $9.1 billion offer, which some analysts say could put Family Dollar's Matthews headquarters and 1,400 corporate jobs at risk.

Decker says she doesn't see a conflict.

"In my role at Family Dollar, I am a board member and have fiduciary responsibilities to the shareholders," she said Wednesday in a statement. "As commerce secretary, I work every day to create jobs and help North Carolina thrive. I can perform both roles and meet my responsibilities."

One corporate governance expert isn't so sure.

Decker's situation illustrates why people often step down from corporate boards when they assume public office, said Charles Elson, head of the University of Delaware's Weinberg Center for Corporate Governance.

"It's going to be awkward for her," he said. "Getting the highest (buyout) price may not be in the best interest of the state."

Decker is paid more from her role on the 11-member Family Dollar board than she is for leading the N.C. Department of Commerce. Family Dollar paid her $149,546 in cash and stock in its 2013 budget year, according to a securities filing. She makes $136,000 as commerce secretary.

Decker, who was appointed commerce secretary by Gov. Pat McCrory, owns 7,439 shares of Family Dollar stock, which at Wednesday's closing price of $80.23 per share made it worth $596,830.97.

The state's ethics law does not appear to prohibit a Cabinet appointee from serving on a corporate board. But it does require disclosure of such positions, which Decker has done. Decker is also a board member for Charlotte-based Coca-Cola Bottling Co. Consolidated.

Other prominent Family Dollar board members include the company's former general counsel George Mahoney, former N.C. Gov. Jim Martin and Queens University of Charlotte President Pamela Davies.

Family Dollar announced in July it had reached agreement on a $74.50 per-share cash-and-stock deal with Virginia-based Dollar Tree. Dollar General later offered to buy Family Dollar in a $78.50 per-share all-cash deal.

Family Dollar rejected Dollar General's offer. On Tuesday, Dollar General increased its offer to $80 per share and said it would be willing to divest itself of as many as 1,500 stores to avoid problems with federal antitrust regulators. Family Dollar said it would review the new offer.

A Family Dollar spokesperson said no shareholder meeting has been set to consider buyout offers.


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