May, Associated Holders Approve Merger Proposal
May Department Stores shareholders formally and enthusiastically approved their company’s purchase of Associated Dry Goods here Friday, clearing the way for May Co. California and J. W. Robinson to receive their orders from the same corporate parent.
May Chairman David C. Farrell, 53, whose disciplined, hands-on style has made May one of the nation’s most respected merchants, beamed as he announced the vote to more than 200 shareholders gathered in an auditorium at May’s 1890s vintage Famous-Barr downtown department store. Of the shares voting, 97% were cast in favor.
Earlier Friday morning in New York, Associated shareholders also voiced their approval--although less resoundingly. They will receive 1.72 shares of May for each Associated share in a stock swap valued at about $2.5 billion. The merger is effective at 11:59 p.m. EDT tonight.(May’s stock was split recently, doubling the amount to be exchanged for each Associated share. As part of the merger vote, May shareholders also approved an increase in the authorized number of common shares to 350 million from 200 million.)
Praising Associated Chairman Joseph H. Johnson’s cooperation over the 2 1/2 months since the companies agreed to merge, Farrell said the combination “will mark a new era” in retailing.
Wall Street certainly acknowledges that the combined companies will be a powerhouse, with more than $10 billion in annual sales. May will gain entree into new parts of the country and new retailing segments--notably the upscale fashion-house business in which Associated’s 48-store Lord & Taylor unit is a leader.
Farrell, who greeted individual shareholders at their seats before getting the meeting under way promptly at 10 a.m., said he sees “ample opportunities for expansion” of the chain. “Our intention is to expand the Lord & Taylor franchise in an orderly manner.”
