Byline: Valerie Seckler

NEW YORK--Analysts insist the deal won't fly at $19, but late last week Carson's extended its $19-per-share cash bid for Younkers for the third time in two months, saying it controls 40 percent of the retailer's shares.
The offer now expires at midnight May 3, two weeks before Younkers' May 17 annual meeting.
Carson Pirie Scott & Co. said it snared another 10 percent of Younkers stock in the last five weeks to control 40 percent of its 9.2 million shares. As of April 5, Younkers shareholders tendered 2,520,940 shares, or about 28 percent of the stock in Younkers.
Carson's, a 51-unit department store operator based in Milwaukee, owns an additional 1,047,500 Younkers shares.
The question remains as to whether the $19 bid is enough to win Carson's the votes to replace three Younkers board members, including Thomas Gould, chairman and chief executive officer, with its own nominees.
"It's not likely Younkers shareholders would pressure management to elect new board members if fewer than half their shares have been tendered," said Philip Abbenhaus, analyst, Stifel, Nicolaus, St. Louis.
However, John Curti, analyst at Securities Corp. of Iowa, Des Moines, suggested some Younkers shareholders who haven't tendered may vote in favor of Carson's nominees to pressure Younkers management to negotiate.
"I think there are some institutional holders who didn't want to tender at $19, but who would vote for Carson's slate of directors," Curti said. "I think Carson's is going to get its guys on the board."
Carson's nominees are John Burden III, former chairman and ceo, Federated Department Stores and Allied Stores Corp.; Chaim Edelstein, a Federated consultant and former ceo of Abraham & Straus, and Alan Cooper, vice president and general counsel of Dickstein Partners Inc., a New York investment firm.
The nominees would succeed David Hurd, Ferd O. Lawson and Gould.
Carson's has said that if it fails to complete its tender offer or place its nominees on Younkers' board--with an eye to putting Younkers up for auction--it would sell its Younkers stake and end its takeover effort.
--Fairchild News Service

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