(AP) Federated Department Stores Inc. has reached a deal to buy rival May Department Stores Inc., according to published reports.
Executives close to the deal told The Washington Post that Federated will pay about $10.4 billion. The Wall Street Journal also reported the deal, and both newspapers cited unnamed sources.
The deal would bring together the operator of Macy’s and Bloomingdale’s with a company known for its Marshall Field’s and Lord & Taylor chains, creating a company with 1,000 stores and $30 billion in annual sales.
The merger comes as retailers look to consolidate to reduce advertising and other costs while gaining bargaining power with suppliers. Just last November, Kmart Holding Corp. agreed to buy Sears, Roebuck & Co. for $11.5 billion.