Federated's Billion Dollar Merger

Two big department store chains are reportedly joining forces to create a retail giant.

Federated Department Stores, operator of Macy's and Bloomingdale's, has reached a deal to buy rival May Department Stores for eleven billion dollars in stock.

The deal would bring together Cincinnati-based Federated with the company known for its Marshall Field's and Lord and Taylor chains, creating a company with a thousand stores and 30 billion dollars in annual sales.

Executives close to the deal, says the merger was approved by the boards of both companies over the weekend. The merger, was also approved by shareholders and regulators, comes as retailers look to consolidate in order to reduce costs while gaining bargaining power with suppliers.