Dollar General Agrees to Be Acquired by KKR

Dollar General Shareholders will Receive $22 Per Share in Cash Transaction Valued at $7.3 Billion

Dollar General Corp. (NYSE: DG) today announced that it has entered into an agreement to be acquired by affiliates of Kohlberg Kravis Roberts & Co. L.P. ("KKR") in a transaction with a total value of approximately $7.3 billion, including approximately $380 million of net debt.

Under the terms of the agreement, Dollar General shareholders will receive $22 in cash for each share of Dollar General common stock they hold, representing a premium of approximately 31% over Dollar General's closing share price of $16.78 on March 9, 2007, and a premium of approximately 29% over the average closing share price during the previous 30 trading days.

"We are very pleased to announce a transaction that provides excellent value for our shareholders, representing a significant premium and the certainty of cash," said David A. Perdue, Chairman and Chief Executive Officer of Dollar General. "Our Board of Directors firmly believes that this is the right transaction for our shareholders, employees and customers. Going forward, employees will benefit from the continuity of a solid business plan and new investments in the future of the business. Our customers will continue to enjoy the convenience, value and great service that they've come to expect from Dollar General over our proud 68-year history."

Michael M. Calbert, a Member of KKR, said, "Dollar General is an outstanding company with a strong market presence and a rich legacy. We have worked closely with many retail companies in driving success and unlocking value, and we look forward to partnering with the Dollar General team to position the company for future growth."

The merger is subject to the approval of Dollar General shareholders, customary closing conditions and regulatory approvals. The transaction is expected to close in the third quarter of 2007.

The Board of Directors of Dollar General unanimously approved the merger agreement and has recommended that Dollar General shareholders vote in favor of the transaction.

Debt financing for the transaction has been committed by Goldman Sachs and Lehman Brothers, subject to customary terms and conditions.

Lazard and Lehman Brothers are financial advisors to Dollar General and Wachtell, Lipton, Rosen & Katz is its legal counsel. Goldman Sachs is acting as financial advisor to KKR. Simpson Thacher & Bartlett LLP is acting as legal advisor to KKR. - SOURCE: Dollar General Press