By  on June 2, 1994

NEW YORK -- Striving to emerge from bankruptcy as an independent, public company as quickly as it can, R.H. Macy & Co. said Wednesday it will file its reorganization plan on June 30 and has fine-tuned its business plan. The company's objectives were disclosed to Wall Street analysts at a meeting in the Waldorf-Astoria. The presentation was designed to build support for the chain and entice potential investors. Compared to the original business plan issued in May 1992, this version projects more conservative sales growth but further expense reductions leading to stronger gains in earnings as a percentage of sales through fiscal 1999. The old plan made projections through fiscal 1998.

"They [Macy's] came off very confident," said Peter Schaeffer of Dillon Reed, one of 100 analysts who attended the meeting. "They seem to have the creditors on their side."

"It gave potential investors more of a feeling for the company by providing a lot of background," added analyst Walter Loeb, who felt the meeting "came off very well." Sources said Myron E. Ullman, Macy's chairman and chief executive officer, said little about Federated Department Stores, which is seeking a hostile takeover of Macy's. Many retail observers are waiting for Federated to make another move on Macy's, possibly breaking out a proposal with improved payouts, and eventually a full-blown reorganization plan. If the payout is rich enough, the court would have to consider Federated as an alternative.

Federated issued an initial proposal May 9, but bondholders are backing Macy's latest reorganization proposal, an enhanced package also issued May 9. In addition, court-appointed mediator Cyrus R. Vance last month reaffirmed Macy's exclusivity rights, which expire Aug. 1, in effect tossing aside other proposals as inadequate. Exclusivity gives Macy's the advantage of filing a plan before any other party. That's an appealing element to creditors, who want a payout as soon as possible.

On Wednesday, Macy's released its timetable for recovery. It said it will distribute the full text of its revised business plan Aug. 1, get its reorganization plan confirmed Nov. 30 and emerge from bankruptcy Jan. 31, 1995.

In the new business projections, Macy's sales growth is more conservative -- from $6.2 billion in the year ending July 31, 1994 to $8.4 billion for the year ending July 31, 1999. The old plan projected sales at $6.59 billion for fiscal 1994 to $8.53 billion for fiscal 1998. In the new plan, comparable-store sales gains rise to 4.3 percent in fiscal 1999 from a negative 1.9 percent in fiscal 1994, while the old plan showed comparable-store sales rising to 6.6 percent in fiscal 1998 from 5.5 percent in fiscal 1994.

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