Dollar General 2008 Annual Report Download - page 25

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ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
General
Accounting Periods. The following text contains references to years 2009, 2008, 2007,
and 2006, which represent fiscal years ending or ended January 29, 2010, January 30, 2009,
February 1, 2008, and February 2, 2007, respectively. Our fiscal year ends on the Friday closest
to January 31. Fiscal years 2008 and 2006 were 52-week accounting periods As discussed
below, we completed a merger transaction on July 6, 2007, and therefore the 2007 presentation
includes the 22-week Predecessor period of Dollar General Corporation through July 6, 2007,
reflecting the historical basis of accounting prior to the Merger, and a 30-week Successor period,
reflecting the impact of the business combination and associated purchase price allocation of the
merger of Dollar General Corporation and Buck Acquisition Corp. (“Buck”), from July 7, 2007
to February 1, 2008. Buck was formed on March 6, 2007, and its results of operations prior to
the Merger, related solely to interest rate swaps entered into in anticipation of the Merger, are
included in the 2007 Successor results of operations. Transactions relating to or resulting from
the Merger are discussed separately. This discussion and analysis should be read with, and is
qualified in its entirety by, the Consolidated Financial Statements and the notes thereto. It also
should be read in conjunction with the Forward-Looking Statements/Risk Factors disclosures set
forth in the Introduction and in Item 1A of this report.
Purpose of Discussion. We intend for this discussion to provide the reader with
information that will assist in understanding our company and the critical economic factors that
affect our company. In addition, it should help the reader understand our financial statements, the
changes in certain key items in those financial statements from year to year, the primary factors
that accounted for those changes, as well as how certain accounting principles affect our
financial statements.
Our 2007 Merger
On July 6, 2007, we completed a merger (the “Merger”) and, as a result, we are a
subsidiary of Buck Holdings, L.P. (“Parent”), a Delaware limited partnership controlled by
investment funds affiliated with Kohlberg Kravis Roberts & Co., L.P. (“KKR” or “Sponsor”).
KKR, GS Capital Partners VI Fund, L.P. and affiliated funds (affiliates of Goldman, Sachs &
Co.), Citi Private Equity, Wellington Management Company, LLP, CPP Investment Board
(USRE II) Inc., and other equity co-investors (collectively, the “Investors”) indirectly own a
substantial portion of our capital stock through their investment in Parent.
The Merger consideration was funded through the use of our available cash, cash equity
contributions from the Investors, equity contributions of certain members of our management
and the debt financings discussed below. Our outstanding common stock is now owned by
Parent and certain members of management. Our common stock is no longer registered with the
Securities and Exchange Commission (“SEC”) and is no longer traded on a national securities
exchange.