Ruling Removes Obstacle to Campeau’s Takeover Bid

A federal judge Monday blocked as unconstitutional an Ohio takeover statute aimed at thwarting Canadian developer Campeau Corp.’s attempted hostile takeover of Federated Department Stores.

U.S. District Judge Carl Rubin issued an injunction sought by Campeau Corp., which challenged the legislation as part of its battle to buy Federated, parent of Ralphs Grocery and Bullock’s deparment stores.

The Ohio Foreign Business Acquisition Act, enacted Feb. 12, would have required Toronto-based Campeau and any other foreign buyer of a Ohio company to file documentation on the effect of its offer on the local economy.

“A state may not enact laws which discriminate against foreign commerce or which may adversely affect interstate commerce by creating a risk of inconsistent state regulation,” Rubin said in his decision.

The ruling at least temporarily removed one of several legal stumbling blocks to Campeau’s efforts to acquire Cincinnati-based Federated, which has rejected all of Campeau’s offers.

Meanwhile, Campeau on Monday extended its $66-a-share, or about $5.94-billion, offer for Federated, if it agrees to a friendly merger by Friday. If no decision is made by then, Campeau is offering only $61 a share, or $5.47 billion.