Jos. A. Bank, Men's Wearhouse Play Hard To Get But A Deal Needs To Happen

Dec 23 2013, 1:41pm CST | by

Jos. A. Bank, Men's Wearhouse Play Hard To Get But A Deal Needs To Happen
Photo Credit: Forbes Business

How many times will Jos. A. Bank and Men's Wearhouse say “no” to one another before one of them says “yes” to a merger?

The men’s retailers have now each rejected takeover offers from the other over the last 10 weeks.

The latest rebuff came today when Jos. A. Bank rejected a $1.5 billion acquisition deal from its larger competitor, Men’s Wearhouse.

Robert N. Wildrick, chairman of Jos. A. Bank, said, “Our Board undertook a thorough review and determined that the per share consideration in the proposal made to us by Men’s Wearhouse was simply not in the best interest of our shareholders.”

Men’s Wearhouse said it was caught off guard by the rejection.

“Given Jos. A. Bank’s repeated expressions of interest in engaging in good faith discussions about a possible combination with Men’s Wearhouse, we are surprised that Jos. A. Bank has rejected our proposal,” the company said in a statement today.

The November 26 per share offer from Men’s Wearhouse was $55, a nearly 9% premium over the price of Jos. shares at the time. In the roughly three weeks since the offer shares of Jos. were up 13%, but fell today after it rejected of the deal.

The rejection by Jos. is just the latest in the M&A courting games played by both retailers.

Back in early October it was Men’s Wearhouse rejecting a takeover bid from its smaller rival; in that deal Jos. A Bank made a$2.3 billion bid for Houston-based Men’s Wearhouse but failed.

So what’s with all the back and forth?

The two men’s retailers seem to need each other to grow their customer base but neither appears to be willing to give in to the other.

Men’s Wearhouse could benefit from a deal with Jos. A. Bank which claims its customers are bigger spenders with higher annual incomes. Men’s Wearhouse tends to cater to middle-income, younger males. Merging the two could allow it to serve a broader demographic.

Jos. A. Bank is much smaller with 602 stores compared to Men’s Wearhouse’s 1,143. The latter reported $2.5 billion in sales in 2012 (up 4%) compared to $1 billion for Jos which was up 7%. Net income was $132 million and $80 million respectively.

Both companies seem to want to make a deal happen neither can agree on which one should run a combined entity. Men’s Wearhouse would like to see its executive team in charge, and Jos. its own.

What happens next? It looks like Men’s Wearhouse is looking to strengthen its deal in hopes of winning the battle.

“While it is our strong preference to work collaboratively with Jos. A. Bank to realize the benefits of this transaction, we are continuing to carefully consider all of our options to make this combination a reality, including nominating director candidates at Jos. A. Bank’s next annual meeting of shareholders,” the company said in a statement today.

Source: Forbes Business

 
 

Don't miss ...

 

<a href="/latest_stories/all/all/30" rel="author">Forbes</a>
Forbes is among the most trusted resources for the world's business and investment leaders, providing them the uncompromising commentary, concise analysis, relevant tools and real-time reporting they need to succeed at work, profit from investing and have fun with the rewards of winning.

 

blog comments powered by Disqus

Latest stories

Finnish scientists identify new type of black hole
Helsinki, Oct 31 (IANS) Finnish researchers have discovered a new type of low-mass black hole, which is a bright celestial body that emits X-ray, the University of Turku has said.
 
 
Union Carbide ex-chief Warren Anderson is dead
Washington, Oct 31 (IANS) Warren Anderson, former chief executive officer of the Union Carbide Corporation, is dead, a media report said Friday. He was 92.
 
 
Himalayan Viagra fuels gold rush for local Tibetans
Washington, Oct 31 (IANS) Overwhelmed by people trying to find the prized medicinal fungus known as Himalayan Viagra, two isolated Tibetan communities have managed to implement a successful system for the sustainable harvest of the precious natural resource, suggests research.
 
 
Oceans were always there on Earth: Scientists
Washington, Oct 31 (IANS) Debunking previous theories that water came late to Earth well after the planet had formed, researchers have significantly moved back the clock for the first evidence of water on Earth and in the inner solar system.
 
 
 

Latest from the Network

Orson Welles last film to be released
Orson Welles' final movie will finally be released next year. The acclaimed filmmaker had worked on 'The Other Side of the Wind' - which chronicles a temperamental film director battling with the Hollywood establishment...
Read more on Movie Balla
 
Game of Thrones stars get pay rise
'Games of Thrones' cast members will be paid $300,000 an episode. Five of the shows biggest stars - Peter Dinklage, Kit Harington, Lena Headey, Emilia Clarke and Nikolaj Coster-Waldau - have landed bumper payrises after...
Read more on Celebrity Balla
 
Mike Tyson: I was abused
Mike Tyson claims he was sexually abused as a child. The 48-year-old retired boxer was ''snatched'' off the street when he was seven by an ''old man'', who he never saw again after the shocking one-time incident....
Read more on Celebrity Balla
 
Amanda Bynes released from psychiatric facility
Amanda Bynes has been released from a psychiatric treatment facility. The 'Easy A' actress was spotted walking around Sunset Strip, West Hollywood, last night (30.10.14), 19 days after she was admitted to the hospital...
Read more on Celebrity Balla
 
Lindsay Lohan sued for 60m
Lindsay Lohan is being sued for over $60 million. A website developer has filed a case against the 'Mean Girls' actress and her brother Michael in which he accused them of stealing one of his ideas. According to Fima...
Read more on Celebrity Balla
 
Russell Brand to give money away
Russell Brand plans to give away his future earnings. The 39-year-old star insists he ''doesn't need'' to make money for himself anymore so wants to use his fortune to help those in need. He told Vanity Fair magazine...
Read more on Celebrity Balla
 
Koji Uerhara Signs 2-Year, $18M Deal With Boston Red Sox
Ace Japanese closer Koji Uehara signed a two-year deal with the Boston Red Sox on Oct. 30.According to MLB.com's Ian Browne, Uehara's deal is worth $18 million:"Perhaps it was fitting that the Red Sox announced a two-...
Read more on Sport Balla
 
Finnish scientists identify new type of black hole
Helsinki, Oct 31 (IANS) Finnish researchers have discovered a new type of low-mass black hole, which is a bright celestial body that emits X-ray, the University of Turku has said. Researchers at the Finnish university...
Read more on Business Balla
 
Union Carbide ex-chief Warren Anderson is dead
Washington, Oct 31 (IANS) Warren Anderson, former chief executive officer of the Union Carbide Corporation, is dead, a media report said Friday. He was 92. His death revived memories of the 1984 Bhopal gas tragedy. He...
Read more on Business Balla
 
Himalayan Viagra fuels gold rush for local Tibetans
Washington, Oct 31 (IANS) Overwhelmed by people trying to find the prized medicinal fungus known as Himalayan Viagra, two isolated Tibetan communities have managed to implement a successful system for the sustainable...
Read more on Business Balla