NEW YORK — Just when it looked like a potential combination of Men’s Wearhouse and Jos. A. Bank was dead in the water, the script has been flipped.
Now, it’s Men’s Wearhouse that is offering approximately $1.54 billion for its rival. Less than two weeks ago, Jos. A. Bank dropped a $2.3 billion bid for its competitor. A combination could create a menswear powerhouse of more than 1,700 outlets.
The announcement that Men’s Wearhouse was interested in a possible deal came as a bit of a surprise Tuesday. The retailer had received an unsolicited offer of $48 per share from Jos. A. Bank Clothiers Inc. in September. But it rejected that bid in October, calling it “opportunistic” and inadequate.”
Jos. A. Bank, though, was still in the hunt back then, saying it would be open to raising its offer if allowed to assess whether an increased bid was justified. But Men’s Wearhouse wouldn’t give the Hampstead, Md., company access to nonpublic information, and Jos. A. Bank dropped its bid Nov. 15.
While Men’s Wearhouse publicly scoffed at Jos. A. Bank’s offer, the proposal clearly gave it some food for thought.
In addition, Men’s Wearhouse faced pressure from its biggest shareholder, Eminence Capital LLC. On Wednesday, Eminence urged Men’s Wearhouse to talk with Jos. A. Bank.
The hedge fund argued that a combination of the two businesses would create value and increase the growth potential of Men’s Wearhouse. Eminence owns 9.8 percent of Men’s Wearhouse’s stock.
$1.54 billion
Men’s Wearhouse’s offer for its rival. Provided by Jos. A. Bank
