Cincinnati – Federated Department Stores Inc. said Tuesday it is planning to cut up to 6,200 jobs beginning next year and change all 62 Marshall Field’s stores to the Macy’s name in the fall of 2006 in its biggest steps yet since completing its acquisition of May Department Stores Inc.
The operator of Blooming dale’s also said it will shed the Philadelphia-based bridal-group division it acquired from May and is studying what to do with its Lord & Taylor division.
About 4,500 positions will be eliminated beginning in March as Federated phases out May’s divisional operations in Boston; Houston; Arlington, Va.; and Los Angeles. The remaining 1,700 cuts will be in St. Louis at May’s corporate offices.
Federated had pledged not to cut any jobs before March 1 as part of its acquisition of its rival.
The moves are a logical extension of Federated’s strategy, said Michael Appel of Quest Turnaround Advisors, a turnaround management and advisory firm in Purchase, N.Y.
“Macy’s nameplate is going to take over, and they are streamlining the old divisional operations of the May company and putting them under the Macy’s umbrella,” Appel said.
The job cuts are the first announced since Federated completed in August its $11.9 billion acquisition of rival May, creating a combined retailing powerhouse better able to compete against industry leader Wal- Mart Stores Inc. and upscale merchants. The deal for May combined more than 1,000 stores with $30 billion in annual sales.
The retailer said previously it was eliminating 10 May nameplates and that it was studying whether to keep the name of Marshall Field’s, a Chicago landmark.
“We have great respect for the legacy and traditions of Marshall Field’s, and we carefully researched customer preferences and studied alternatives before making this decision to incorporate Marshall Field’s into the nationwide Macy’s brand,” Federated chief executive Terry Lundgren said in a statement.
In January, May said it was completing a plan to shut down 32 underperforming Lord & Taylor stores. At that time, the company said it would keep open 54 stores in core markets.
Lord & Taylor, under CEO Jane Elfers, has been undergoing merchandising changes, shifting to more contemporary and trendier fashions.
