NEW YORK (MarketWatch) -- Shares of Dollar General DG, +0.00% fell 1.1% in premarket trade Friday, after it's increased buyout proposal for rival discount retailer Family Dollar FDO, -0.57% was rejected. Dollar General had raised its offer on Tuesday to $80 a share in cash, from $78.50. Family Dollar said in a statement that its board voted unanimously to reject the revised offer "on the basis of antitrust regulatory considerations." Family Dollar continues to support the buyout proposal from smaller rival Dollar Tree DLTR, -1.38% which was the equivalent of $74.50 a share in cash and stock, and expects the merger to close as early as November. "There is a very real and material risk that the transaction proposed by Dollar General would fail to close, after a lengthy and disruptive review process," said Howard Levine, chief executive of Family Dollar. Family Dollar's stock eased 0.4% ahead of Friday's open, while Dollar Tree shares slid 1.4%.

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