May Department Stores' stock rose more than 6 percent yesterday after a published report said it had resumed talks with Federated Department...
CINCINNATI — May Department Stores’ stock rose more than 6 percent yesterday after a published report said it had resumed talks with Federated Department Stores about a possible merger.
The Wall Street Journal, citing unidentified sources familiar with the matter, reported yesterday that Federated and May resumed negotiations by telephone this week and, as of Thursday, were about $2 a share apart on a deal price.
Federated and May declined comment. A telephone message seeking comment was left with Terry Lundgren, Federated’s chairman and chief executive, at his office in New York.
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Negotiations had reportedly broken down last week after the two companies’ chief executives couldn’t agree on a price. The May board had been prepared to negotiate a deal, the Journal reported.
May’s shares rose $1.93 to close at $33.45 yesterday. May operates Lord & Taylor, Famous-Barr, The Jones Store and Filene’s.
Shares of Federated, owner of Macy’s and Bloomingdale’s, fell 65 cents to close at $56.72.
May announced last week that its fourth-quarter earnings had slid on weaker sales at stores open at least a year and fell short of Wall Street’s expectations.
That earnings release was the first since last month’s abrupt departure of chairman and CEO Gene Kahn. He resigned just seven months after helping May outbid Federated to acquire Target’s Marshall Field’s department stores and nine Mervyn sites for $3.24 billion — a price that some analysts called too steep.