NEW YORK - May Department Store Company shareholders have approved the proposed merger with Federated Department Stores, Inc., according to May Chairman, President and CEO John Dunham, who relayed the news at the end of the company's brief annual meeting in New York this morning.
Before announcing the results, Dunham endorsed the merger, saying that the new company would be in a stronger position to deal with a broad range of competitors than either department store company would be on its own.
"Federated and May together will have the strength, presence, and economies of scale to succeed," he said, noting that the new entity will be a $30 billion organization, with stores in 49 states. "We will also be able to eliminate redundancies and implement the best practices of each company."
The new company, he continued, will be able to improve assortments and merchandising, expand proprietary offerings and customer loyalty programs and launch a national bridal gift registry.
Responding to an audience question, however, Dunham made it clear that Federated was in the driver's seat. That company, he said, would determine the fate of overlapping corporate executives, though no layoffs will take place before March 1 of next year.
Federated will also determine the fate of the Lord & Taylor store on Fifth Avenue in New York City, stated Dunham - a decision that has yet to be made.
According to the merger agreement, each share of May common stock will be converted into the right to receive $17.75 per share of cash and 0.3115 shares of Federated stock.