Ketchum and Kekst pitch in on Federated, May merger

CINCINNATI: Ketchum and Kekst worked on opposite sides of Federated Department Stores' acquisition of May, steering their clients through the $17 billion merger announced last week.

CINCINNATI: Ketchum and Kekst worked on opposite sides of Federated Department Stores' acquisition of May, steering their clients through the $17 billion merger announced last week.

Kekst & Co. handled M&A communications for May, a longtime client. Federated worked with Ketchum, which has aided the chain with its rebranding efforts for more than two years.

"Federated is [trying to create] a premier nationwide retailer, and one of the rationales for that is the ability to market on a national basis," said John Weckenmann, Ketchum's SVP and director of the North American corporate practice.

Federated has decided that various May Department Stores will be rebranded as Macy's, a chain that will try to establish itself in the moderate to upper-moderate price category, explained Carol Sanger, VP of corporate affairs.

The combined company will have annual sales of $30 billion and operate in 49 states with

950 stores.

But Federated might face a challenge in turning Macy's into a national brand. Former May store employees will need to be taught how Federated operates and how to service more upscale consumers.

"It would appear that the first order of business is culture," said Fred Marx, a partner with Marx Layne in Farmington Hills, MI.

Regarding a possible internal communications campaign designed to promote more upscale service, Weckenmann said, "We have provided some assistance on the internal side, but haven't talked that far out in advance."

Sanger said that the company is working on communications plans that will go into place once the deal closes, sometime in the third quarter.

Federated will continue to operate Bloomingdale's, positioning it as an upscale, fashion- oriented shop, but hasn't decided whether to keep the Marshall Field's brand in Chicago or the Lord & Taylor brand nationally, Sanger added.

The deal was unusually large for Ketchum. Mergermarket didn't rank the firm in the top 20 in value or number of transactions last year, but the value of the Federated deal alone would have placed it in the top 10.

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