Family Dollar takeover in the works?

The speculation won't quit: Analysts and commentators keep wondering if Family Dollar will be sold to its major rival, Dollar General.

The latest round comes in the form of an article in the Tennessean, Goodlettsville-based Dollar General's hometown paper.

"Does Dollar General have Family Dollar takeover in mind?" the headline asks.

Matthews-based Family Dollar is one the region's major corporations, with about 1,000 people working at their headquarters on Monroe Road. A Charlotte-grown success story, Family Dollar operates about 7,600 stores.

Dollar General is larger, with 11,000 stores. Both companies are fighting big-box rival Walmart, while also trying to pick up business from grocery stores and other traditional retailers they can undercut on price.

Analysts are sounding off over whether a Dollar General-Family Dollar combination makes sense. Yes, says Credit Suisse: Such a deal would reduce competition, create a dominant company and lead to big cost savings.

No, says Mark Montagna, an analyst with Avondale Partners: "I do not expect that to happen, he told the Tennessean. "It takes a lot of work to merge two companies … and a lot of things can go wrong. When Dollar General is doing so many things right, I would not expect them to try it."

Family Dollar's next earnings call is scheduled for Oct. 9. Executives might address the takeover speculation there. There are a ton of variables, of course, No. 1 of which is probably whether Family Dollar or Dollar General wants anything to do with a merger or acquisition.

Dollar General's CEO recently said he's not, on an investor conference call. And remember, Family Dollar rebuffed activist investor Nelson Peltz and his Trian Fund in 2011, when they offered to take the company private in a leveraged buyout.

For what it's worth - and file this under "odd" - I was contacted this week by someone who identified themselves as "an investigator based in New York conducting some research on behalf of an investment fund regarding the Family Dollar company."

They were looking for information about whether CEO (and founder's son) Howard Levine views the business as a "family affair," and how that might influence his decisions about the company's future. Hm.