The owner of the Lazarus-Macy's department stores announced today that it will acquire the owner of the Kaufmann's department stores in a deal valued at $11 billion.

Board members at Federated Department Stores Inc., of Cincinnati, and May Department Stores Co., of St. Louis, approved the terms of the historic deal over the weekend.

The combined retail operation would bring together nearly 1,000 stores nationwide, including Lord & Taylor, Marshall Field's, Bloomingdale's and Filene's.

If the acquisition goes through, it could mean the end of the Kaufmann's name in department store retailing and give Federated the dominant local presence that did not come when it acquired the Joseph Horne Co., the city's other homegrown department stores, in the 1990s.

It would also mark yet another major shift in the retailing industry, which has seen operators like J.C. Penney work to reinvent themselves and mall-centric Sears agree to be acquired by strip-center dweller Kmart.

The retailers who used to set the standard have lost market share to Wal-Mart, Target, big box stores and specialty retailers.

Pittsburghers have seen those changes, even been happy to shop those stores, but many have also been careful to patronize Kaufmann's. They have turned out faithfully for midnight sales and weekend sales with coupons in hand.

Once the Horne's name disappeared, local shoppers clung to the familiar Kaufmann's, which has been selling them shoes and bedspreads since the 1870s.

Generations of Pittsburghers have turned out faithfully for midnight sales and weekend sales with coupons in hand.

"I think Kaufmann's has trained Pittsburgh how to shop," said Herky Pollock, a retail real estate broker with CB Richard Ellis/Pittsburgh.

Kaufmann's physical dominance of the Western Pennsylvania region can be seen in the fact that it operates seven department stores in Allegheny County alone, plus locations in Beaver, Westmoreland and Washington counties and beyond. There are four Lazarus-Macy's department stores and two furniture stores throughout same region.

It's not known what will happen Downtown, where both retailers have had their struggles. Along Fifth Avenue, both a former Lazarus and a former Lord & Taylor store sit empty. Both were closed last year because of slow sales.

The city has long kept an eye on the flagship Kaufmann's store, with its famed clock on the corner of Fifth and Smithfield Street, fearing changes in the market and in retailing generally might threaten Downtown's largest retail anchor.

Federated, which showed little interest in keeping the Horne's name, is already moving to put almost all of its regional department-store operations under the marquee of Macy's,one of its best-known brands. Effective this Sunday, all Lazarus-Macy's stores in Pittsburgh and elsewhere will carry the moniker made famous by the annual Thanksgiving Day parade in New York City.

In fact, Federated may be in a position to acquire its rival because it moved faster than May to give up some of the department store traditions that had worked for so long.

Recognizing consumers no longer saw much difference in retailers that carried many of the same lines -- Tommy Hilfiger, Liz Claiborne, Sag Harbor and so on -- Federated began investing heavily in its own in-house brands a few years ago. May has been slower in taking that step.

Federated has also been experimenting with changes such as adding shopping carts to its stores, installing central checkout stations and department signage.

Last year Federated reported sales in stores open at least a year rose 2.6 percent, while May's overall sales dropped 2.4 percent. That has been cited as a factor in the abrupt announcement in January that May's chief executive officer, Gene Kahn, had resigned.

Federated last year had total sales of $15.63 billion; May had total sales of $14.44 billion, which would form a single company with about $30 billion in sales.

Federated will pay between $35 and $36 a share to acquire May. May shares closed Friday at $35.35. Federated closed $56.79 Friday.

One of more obvious consequences of a merger of the two companies would be overlapping store locations. In Allegheny County, both have stores at South Hills Village, Ross Park Mall and Monroeville Mall.

If Federated decides to create one large Macy's chain, it might consider replacing redundant sites with its Bloomingdale's model, although the company is being selective where it puts that upscale chain.

A pullout from the various malls would likely force the owners to get creative in filling the space, said Pollock. For example, natural foods grocer Whole Foods Market might take a look at South Hills Village or any of the malls might look to non-traditional mall retailers along the lines of a Borders bookstore, a Target or some other mix of specialty stores.

"Look at what Dick's (Sporting Goods) did in Robinson," said Pollock, referring to a two-story store the Findlay-based chain opened there.

In the big picture, a merger of the two rivals could provide real benefits, said Banc of America Securities analyst Dana E. Cohen, in a report written last week as a deal appeared to be nearing. Cohen said the combination could create one retailer with the best merchandise from both.

Marketing budgets now invested in numerous pages of competing newspaper ads could be shifted to a brand-building TV campaign, he said. Some of the savings could even be used to improve in-store service.

Department stores have struggled in recent years to keep market share in the face of competition from discounters such as Wal-Mart and Target, as well as specialty retailers like The Gap and American Eagle Outfitters.

Despite the talk of loyalty to the Kaufmann's name, area consumers may not really be bothered by a change, said Gayle Marco, an associate professor of marketing at Robert Morris University. "It's the merchandise that people are going for."

When May officials decided to merge the administrative operations of Kaufmann's and the Boston-based Filene's division a few years ago, customers did not stop shopping at the stores, Marco said.

After seeing Hill's department stores merge with Ames and watching Sears agree to a deal with Kmart, Marco believes consumers are getting used to the comings and goings of retailers. "They kind of take it with a grain of salt," she said.

In addition to the Kaufmann's stores, May Department Stores also owns a number of bridal and tuxedo chains, including the David's Bridal stores.