Bringing you today’s top business story. Dollar Tree is making a significant move into new territory by acquiring leases for 170 stores from the 99 Cents Only chain, which recently filed for bankruptcy. The acquisition spans locations in Arizona, California, Nevada, and Texas.

Starting this fall, Dollar Tree plans to reopen these stores under its own brand, marking a major expansion for the Virginia-based retailer. This move follows the closure of all 370 99 Cents Only stores after the chain filed for bankruptcy in April.

This acquisition highlights a notable consolidation in the retail sector. Unlike 99 Cents Only, which focused on selling groceries in a regional market, Dollar Tree operates nationally with a focus on discretionary items such as party supplies and home goods. Known for its fixed pricing strategy, Dollar Tree was the last of the dollar store chains to raise its prices from $1 to $1.25 and above in 2021.

Dollar Tree also owns Family Dollar, which has faced challenges and is set to close 975 stores. By acquiring the 99 Cents Only leases, Dollar Tree can expand its presence on the West Coast without the higher costs associated with building new stores.

Michael Montani, an analyst at Evercore IRI, noted that Dollar Tree’s management sees these locations as fundamentally strong assets and seized the opportunity to capitalize on a competitor’s weakness.

One potential challenge for Dollar Tree is the size of the 99 Cents Only stores, which average around 20,000 square feet—more than double the size of a typical Dollar Tree store. How Dollar Tree will adapt to these larger spaces remains to be seen.