Campeau Chains Can Keep Paying Out Some Benefits

Campeau Corp.’s huge U.S. department store divisions, Federated Department Stores Inc. and Allied Stores Corp., won the right in bankruptcy court Thursday to keep paying certain employee and retiree benefits.

The approval was sought, among other reasons, to ease the concerns of employees at Federated and Allied. The units filed for Chapter 11 bankruptcy court protection on Jan. 15 after being crushed by takeover debts.

Separately, Federated officials confirmed that they are considering calling off efforts to sell Bloomingdale’s, the high-fashion department store chain that is known as the crown jewel of the Campeau retail empire.

Bloomingdale’s was put on the block in September as part of a last-ditch effort to avert a financial collapse. After Federated made its Chapter 11 filing last month, company officials said they would still try to sell the 17-store chain, although they conceded that they no longer could meet their February deadline.

Now, however, Federated is studying whether “there would be more value . . . by retaining Bloomingdale’s or by selling it,” said spokeswoman Carol Sanger.

“Absent a bid for Bloomingdale’s that would be so overwhelming that we’d have to act on it, the decision would be delayed pending the construction of an overall reorganization plan for the companies,” Sanger said.

Retail industry sources have said that potential bidders for Bloomingdale’s have been unwilling or unable to come up with offers high enough to satisfy Federated, which has sought more than $1 billion for the chain. Bidders also may have been scared off by the need to secure bankruptcy court approval for such a sale.