Betting on Wallstreet: Robert Campeau and the destruction of retail
Robert Campeau: the man who bought Bloomingdale’s—and broke American retail doing it
From a post-war Ottawa homebuilder to a swaggering 1980s dealmaker, Robert Campeau rode junk-bond rocket fuel to snag Allied Stores (1986) and then Federated Department Stores—owner of Bloomingdale’s (1988). The plan: use iconic retailers to anchor hulking real-estate plays. The problem: interest bills that cash flow couldn’t cover. When the tide went out, the debt mountain snapped—and in January 1990, Allied and Federated plunged into Chapter 11 in what was then the largest retail bankruptcy in U.S. history. It was a masterclass in speed, leverage, and hubris.
What we cover in this episode
How a self-taught developer who built Ottawa’s skyline (Place de Ville) convinced Wall Street to fund billion-dollar bids.
The Allied ($3.6B) and Federated/Bloomingdale’s ($6.6B) takeovers—and why “own the stores, own the malls” was irresistible in ’86–’88.
The cash-flow math that killed the deal: rising rates, softening sales, and ~$8B of IOUs coming due.
Fallout: courtrooms, creditors, and the eventual rebuilding of a slimmer Federated that would later become today’s Macy’s, Inc. (after bankruptcy reorg).
Why it matters
Campeau is the cautionary tale for every “move fast, buy big” fantasy: speed can win auctions, but debt keeps score. If your thesis relies on tomorrow’s growth to pay yesterday’s interest, you’re not running a company—you’re racing a clock.
Want to learn more? Read Going for Broke: How Robert Campeau Bankrupted the Retail Industry, Jolted the Junk Bond Market, and Brought the Booming 80s to a Crashing Halt by John Rothchild.