May Stores purchase planned.

The Washington Times Knight Ridder/Tribune Business News

Mar. 1--Federated Department Stores Inc., which owns Macy's and Bloomingdale's, announced yesterday it would buy May Department Stores, owner of the Hecht Co., for about $11 billion, positioning itself to be a powerful national retailer.

The purchase would mean most of May's regional chains, including 148-year-old homegrown Hecht's, Lord & Taylor and Strawbridge's, likely will be converted to the Macy's name.

The name change would bring the end of another Washington retailer, going the way of the defunct Woodward & Lothrop, Garfinckel's and Hechinger's.

"Today, we have taken the first step toward combining two of the best department store companies in America, creating a new retail company with truly national scope and presence," said Terry J. Lundgren, Federated's chairman, president and chief executive officer.

The proposed deal would turn Federated into a $30 billion national retailer with more than 950 department stores and about 700 bridal and formalwear stores. It would add another 15 states to Federated's 34-state operating base.

"In today's retail environment, competition comes from every conceivable retail format," said John Dunham, May's president and acting chairman and CEO. "To succeed, we have to operate more efficiently and compete more effectively against players at all levels of the retail demographic."