Shareholders Say Yes

Shareholders of both Federated Department Stores Inc. (Cincinnati) and The May Department Stores Co. (St. Louis) separately approved the proposed merger of both companies at each retailer’s annual shareholders meetings held today.

At Federated’s Annual Meeting of Shareholders, held at its Cincinnati headquarters, about 81 percent of shares outstanding, representing more than 99 percent of votes cast, were in favor of a resolution to authorize the issuance of Federated common stock pursuant to an agreement and plan of merger between the two companies.

According to the merger agreement, each share of May common stock will be converted into the right to receive $17.75 per share of cash and 0.3115 shares of Federated stock.

“As we have stated before, the combined company will be an exciting organization – a fashion retailer with about $30 billion in sales and truly national scope and presence,” said Terry Lundgren, Federated's chairman, president and ceo. “The road ahead for Federated is very exciting and presents us with an opportunity to transform our industry in a way that will benefit customers from coast to coast.”

John Dunham, May’s chairman, president and ceo, told shareowners attending the May Co. meeting that it believes the new organization will be a stronger company than either could have been on its own. “We’ll be able to grow sales, store-for-store sales, and profits faster than either company could do on its own,” he said. “In simple terms, together we will be much stronger in every aspect of the business than either company could be independently. ”

The merger is contingent on completion of the antitrust review of the transaction by regulators, which is expected to be completed during the fiscal third quarter of 2005.

Federated, with corporate offices in Cincinnati and New York, is one of the nation's leading department store retailers, with annual sales of more than $15.6 billion. It operates more than 450 stores under the Macy's and Bloomingdale's nameplates.

The May Department Stores Co. currently operates 487 department stores under the names of Famous-Barr, Filene’s, Foley’s, Hecht’s, Kaufmann’s, Lord & Taylor, L.S. Ayres, Marshall Field’s, Meier & Frank, Robinsons-May, Strawbridge’s, and The Jones Store, as well as 243 David’s Bridal stores, 453 After Hours Formalwear stores, and 11 Priscilla of Boston stores in its Bridal Group.