Tuesday, February 15, 2005

Federated, May End Merger Talks

NEW YORK (Reuters) - Merger talks between Federated Department Stores Inc. (FD) and May Department Stores Co. (MAY) broke down after the two companies could not agree on the price Federated would pay for May, the Wall Street Journal reported on Tuesday, citing people familiar with the matter.

The newspaper the May board was prepared to negotiate a deal, but May's interim chief executive officer, John Dunham, and Federated CEO Terry Lundgren could not agree on a price.

The companies could not immediately be reached for comment.

According to the Journal, Federated could now look at other acquisition targets, including the department-store division of Saks Inc. (SKS). The Saks board is expected to make a decision about a spinoff or sale of the group in the next several weeks, according to the article.

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