Washington's Haft family has again told Dayton Hudson Corp., the nation's sixth-largest retailer, that it is still interested in obtaining control of the Minnesota firm.
Despite an antitakeover law enacted by the Minnesota legislature last month to make it harder for any hostile bidder to buy a company in that state, Dart told Dayton Hudson on Thursday that it may buy 50 percent or more of the company's outstanding stock.
In a letter to Dayton Hudson, Herbert H. Haft, chairman of Dart Group Corp., said a partnership under his control -- called Madison Partnership -- would inform the Federal Trade Commission that the partnership "intends to purchase outstanding shares of common stock of Dayton Hudson ... in an amount exceeding $15 million."
What's more, Haft said, the partnership "may, depending upon circumstances during the next 12 months, purchase amounts of 50 percent or more of the outstanding common stock."
The letter was disclosed by Dayton Hudson yesterday before the stock market opened. The news sent the company's stock soaring, so that it closed $4.375 higher yesterday at $52 a share. More than 2.9 million shares exchanged hands, making it the third most actively traded stock.
Haft, who along with his son Robert -- president of Dart -- has been aggressively trying to buy a major retailer for the past three years, filed documents with the FTC to meet new requirements of the premerger notification rules.
Under the new federal rules put into effect earlier this month, partnerships like Madison are no longer exempt from seeking government permission before buying a large amount of stock in a company.
Under the new antitrust rules -- designed to thwart any anticompetitive mergers -- certain partnerships must follow the same rules as corporations and seek federal approval before buying more than $15 million of stock in a company.
The disclosure of the Haft's letter to Dayton Hudson surprised Wall Street analysts, who only a month ago had predicted the Hafts would drop their interest in the company as a result of the new antitakeover legislation enacted by Minnesota.
At the time, several Wall Street sources said the Hafts had sold their stake in the retailer, which owns the department stores Dayton's and Hudson's, upscale discount chains Mervyn's and Target, and the home furnishings and appliance chain Lechmere.
However, it was clear from the documents filed with the FTC yesterday that the Hafts still hold Dayton Hudson shares. It was unclear how much.
But because the Hafts have not filed a statement with the Securities and Exchange Commission -- required when any investor acquires more than 5 percent of a company's stock -- it was clear that the Hafts' stake was small.
While declining to discuss Dayton Hudson, Robert Haft yesterday said,"We have stated on numerous occasions that we are interested in acquiring a fourth operation company," in addition to Trak Auto Corp., Crown Books Corp. and Dart Holding Corp., subsidiaries of Dart Group. "We are operating people and run good retailers," Haft said.
Nonetheless, Wall Street analysts, pointing to the new state law, were skeptical yesterday about the Hafts' intention.
Their reason: Even if the Hafts buy shares on the open market, they could find their hands tied if they tried to take control of the company because of Minnesota's legal restrictions.
Among other things, if the Hafts buy more than 10 percent of the outstanding shares -- before gaining the approval of the outside board of directors -- they would be barred from selling off corporate assets for five years after they obtained control of Dayton Hudson.
That requirement, in turn, would make it harder to finance any takeover which, based on yesterday's stock prices, would cost more than $5 billion.
As a result, analysts yesterday speculated that the Hafts were merely trying to increase the stock price and then sell their stake, which had declined in value as a result of the state legislation.
"This may be nothing but a tactic to extricate themselves from something that went sour," said Robert Simonson of Kidder Peabody & Co.