P.M. BRIEFING : National Bank of Canada Seizes 13 Million Shares of Campeau

The National Bank of Canada said today that it has seized 13 million shares of Campeau Corp. after the retailer and developer defaulted on loans from the bank.

National Bank said it had taken possession of the shares, which represent 29% of the voting stock in Campeau and which were owned by company Chairman Robert Campeau.

“Those 13 million shares which belonged to Mr. Campeau now belong to us,” said Carole Gagne, a bank spokeswoman.

National Bank also said it has seized about $60 million in debentures that it held as security and has taken steps to have transferred into its name another 4 million of Campeau’s subordinate preference shares.

The bank did not reveal the amount of the loan but said, “It is in default and is not considered current.”

On Tuesday, a syndicate of banks led by Citibank agreed not to declare Campeau’s Federated Department Stores Inc. and Allied Stores Corp. in technical default on $2.34 billion in loans.

The syndicate agreed not to press the point before Jan. 15, giving Campeau more time to show it is making progress in sorting out its financial problems. The bankers previously said they might ask for full repayment of the loan, a demand that presumably could have forced Campeau to file for protection under U.S. bankruptcy laws.