Marshall Field & Co. and BATUS Inc., a subsidiary...

CHICAGO -- Marshall Field & Co. and BATUS Inc., a subsidiary of B.A.T. Industries, p.l.c. of London, have signed a definitive merger agreement under which BATUS will acquire all Marshall Field outstanding stock.

The merger agreement has been approved by the boards of directors of both companies, a Marshall Field spokesman said Tuesday.


BATUS becomes, in effect, the 'white knight' in Field's struggle to fend off a veiled takeover attempt by Wall Street investor Carl C. Icahn. He and a group of investors recently increased to 29.3 percent their holdings of Field stock. Icahn filed documents with the Securities and Exchange Commission showing he would consider either selling or refinancing Field assets, which he said a preliminary appraisal showed far exceeded their book value.

Principal businesses within the retail division of BATUS Inc. are Saks Fifth Avenue, Gimbel Brothers department stores and Kohl's food and department stores in Wisconsin.

The agreement provides that a wholly-owned subsidiary of BATUS will make a cash tender offer for a number of shares of Marshall Field's common stock and Series C convertible preferred stock. The stock will represent or be convertible into 8 million shares of common stock at a price of $25.50 per common share and $45.90 per preferred share.


Following the tender offer and prior to April 1, 1983, the Marshall Field shares not purchased in the tender offer will be acquired for the same price pursuant to a merger of Marshall Field with a BATUS subsidiary.

The transaction is valued at about $310 million.

The tender offer will be conditioned upon the tender of Marshall Field shares representing or convertible into a total of at least 6,085,000 common shares. That is approximately 50 percent of the total number of common shares on a fully-diluted basis.

The tender offer and merger will be subject to the customary conditions, and the merger is subject to approval of the holders of a majority of the outstanding voting shares of Marshall Field.

Because of the agreement, Marshall Field's directors postponed until November its annual meeting of stockholders.

The two companies also entered into a definitive purchase agreement which provides for the purchase by a BATUS subsidiary of 2 million authorized and unissued shared of Marshall Field common stock for a cash price of $25.50 per share. However, the BATUS subsidiary will not be obligated to purchase such shares if any person or group, including BATUS, acquires Field stock representing 50 percent or more of the combined voting power of Field shares.


The agreement also provides that for a period of 12 months following any termination of the merger agreement without the merger being consummated BATUS will have the right of first refusal to purchase any business or properties included in Marshall Field's Chicago Division proposed to be sold by Field to any third party, at a price equal to that offered by the third party.

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