CAMPEAU CORPORATION TO PROVIDE DIRECTORS WITH LEGAL COUNSEL'S FULL OPINION RECOMMENDING NO CLAIMS BE MADE AGAINST O&Y
CAMPEAU CORPORATION TO PROVIDE DIRECTORS WITH LEGAL COUNSEL'S
FULL OPINION RECOMMENDING NO CLAIMS BE MADE AGAINST O&Y
TORONTO, Feb. 5 /PRNewswire/ -- The Ontario Court of Justice today granted a motion requested by Patrick J. Kelly, a director of Campeau Corporation, and ordered that the corporation release to each of its directors, other than those conflicted, on a confidential basis, a copy of the full text of the opinion received in March 1991 from its legal counsel, Blake, Cassels & Graydon, concerning possible claims the corporation might have against Olympia & York Developments Limited (O&Y). In its decision, the court recognized the corporation's concerns about the principle of solicitor-client privilege and agreed that the full report should not be provided to the directors in a position of conflict.
Campeau Corporation stated that it will comply with the court's decision.
The judgment noted that the full opinion need not be considered by the court in its consideration of the plan of arrangement and that the summary previously provided to the board in March 1991 by a specially appointed committee of directors would be sufficient.
"The full text of the opinion confirms that the corporation does not have a legally supportable case to be brought against O&Y. Therefore," said Stanley H. Hartt, chairman, president, and chief executive officer of the corporation, "no rights of value are to be released upon the implementation of the corporation's restructuring Plan of Arrangement."
Earlier today, the newly created Federated Department Stores, Inc. emerged from the Chapter 11 bankruptcy reorganization process in the U.S. Under the plan of reorganization (POR), Federated Department Stores comprises the eight department store subsidiaries of the Federated Stores Inc. and Allied Stores Corporation.
With the effectiveness of the POR in the U.S., Campeau Corporation has surrendered its equity in Federated and Allied, and more than $2 billion of U.S. liabilities are removed from Campeau Corporation. The corporation retains in the U.S. a 12.8 percent interest in Ralphs Grocery Company.
"Subject to final approval from the Ontario Court of Justice, the effectiveness of the U.S. plan of reorganization is an important milestone for Campeau Corporation in proceeding with the implementation of its restructuring under the plan of arrangement approved by the corporation's shareholders and creditors last week," said Hartt. The hearing before the Ontario Court of Justice concerning its final order approving and sanctioning the plan of arrangement will take place at 10 a.m., Thursday, Feb. 6.
/CONTACT: Richard W. Wertheim of Wertheim Howe & Company Inc., 416-594-1600, or home, 416-276-6612, for Campeau/
(CMP.) CO: Campeau Corporation ST: Ontario IN: REA SU:
PS -- NY090 -- 7454 02/05/92 20:28 EST