St. Louis, MO, July 15--May Department Stores is suspending indefinitely its $500 million share-buyback program, the company said Wednesday.
The move is being taken in preparation for the expected late-summer closing of the company's $3.2 billion purchase of the Marshall Field's chain, according to May.
It also comes a day after the company said it is issuing $2.2 billion in long-term debt to cover the acquisition of 62 Marshall Field's stores and assets in Chicago, Minneapolis and Detroit from Target. May is buying nine Mervyn's sites in Minneapolis as well.
Shares of May remained lower following the company's announcement, losing 75 cents, or 2.8 percent, to $25.69.
The debt offering will cost May another $4 million in interest expenses, or 1 cent a share, the company said on Wednesday.
May told certain bondholders that it will redeem their notes maturing in 2024 on Aug. 1. That will also cost May, resulting in a charge of $10 million, or 2 cents a share, to be taken against results for the third quarter.
May is parent of 438 department stores, including Lord & Taylor, Filene's, Famous-Barr and Strawbridge's.
