Morosky Quits Allied as Top Federated Job Fades
Allied Stores President Robert H. Morosky resigned abruptly Friday when it became clear to him that he would not ascend to the chairmanship of the Campeau Corp. retail operation that would combine newly acquired Federated Department Stores with Allied.
Campeau, in a statement issued in Toronto, announced that Morosky had agreed to resign and that Campeau Chairman and Chief Executive Robert Campeau would serve as chairman of both Allied and Federated “for the foreseeable future.”
Campeau also said it had agreed to pay Morosky under terms of his three-year employment contract. Salary alone amounts $1 million annually. Morosky, 47, joined Allied in November, 1987.
Morosky is credited as a major player in Campeau’s successful, 11-week battle with R. H. Macy & Co. to acquire Cincinnati-based Federated Department Stores, which owns Bloomingdale’s, Burdine’s and Rich’s. Macy’s has agreed to buy former Federated divisions I. Magnin and Bullock’s/Bullocks Wilshire.
Early last month at a news conference in New York, Campeau introduced Morosky as the new head of Federated. Morosky said then he was meeting with Federated executives with his first priority being to refocus the attention of employees back to running the stores.
In a telephone interview from his home in Columbus, Ohio, Morosky said his contract called for him to become chairman and chief executive of whatever retail entity existed at the end of this month. But, just in the last week, “Mr. Campeau made up his mind and took control,” he said.
Split Is Friendly
“My contract requires me to be named chairman and chief executive officer but Mr. Campeau has decided he wants to be chairman and chief executive officer. Under terms of the contract, he agreed to honor the payout and I will step aside. He has his family fortune invested. He wanted to be heavily involved, and he likes retailing.
“We had a great relationship and I wish him the very best,” Morosky said, insisting the split is friendly. “I understand the situation perfectly well. God has a plan for all of us. Things will work the best for all of us.”
Morosky said he will resign as a director of both Campeau and the Federated-Allied Stores, but he will be available to consult with Campeau on distribution, expansion and overseas offices, his traditional strengths in the operations end of retailing.
Campeau said in the statement it would name a new chief executive for Federated-Allied, one with “extensive strategic merchandising experience” within 30 days. Strategic merchandising refers to the direction a store’s merchandise takes over the long term.
Morosky would not comment on whether he was instrumental in formulating the Federated takeover. When he was vice chairman and chief financial officer of Limited Inc., he played a key role in the Columbus, Ohio, retailer’s unsuccessful takeover attempt of Carter Hawley Hale Stores in Los Angeles. He spent 15 years at apparel retailer the Limited.
He would only say of the Federated takeover: “The strategies for the new combined Allied-Federated are in place. All it requires is strong leadership and execution. It will be a very strong transaction.”
Howard Goldfeder, 62, who fought the Campeau takeover, stepped down as chairman and chief executive of Federated a week ago.
Morosky joined Allied four months after he resigned from the Limited, taking with him stock valued then at about $50 million. His resignation then surprised Limited watchers. He was credited with building the company’s efficient distribution system as well as arranging financing and acquisitions.
Asked why he returned to Ohio, he said: “Columbus is like a rubber band tied to my waist.”