FREMONT, Calif. - Men's Wearhouse (MW) is raising its offer for Jos. A. Bank Clothiers (JOSB) to about $1.61 billion and taking the bid directly to its rival's shareholders. It also plans to nominate two people to the Jos. A. Bank board.
Men's Wearhouse Inc. disclosed Monday
that it is now offering $57.50 per share for Jos. A. Bank, up from its prior
offer of $55 per share, or $1.54 billion. Jos. A. Bank rejected the previous
offer in late December, saying it was too low.
"Although we have made clear our
strong preference to work collaboratively with Jos. A. Bank to realize the
benefits of this transaction, we are committed to this combination and,
accordingly, we are taking our offer directly to shareholders," Men's
Wearhouse President and CEO Doug Ewert said in a statement.
It said its tender offer expires on
March 28 unless extended.
A representative for Jos. A. Bank
could not be immediately reached for comment.
The announcement by Men's Wearhouse
comes three days after Jos. A. Bank Clothiers Inc. lowered the trigger for its
shareholder rights plan, a plan typically used to help ward off hostile
takeover attempts. The chain cut its trigger to a 10 percent ownership stake
from a 20 percent ownership stake. That's the same ownership threshold as Men's
Wearhouse's shareholder rights plan.
A shareholder rights plan usually
allows existing shareholders to acquire more stock at a discounted rate to ward
off the investor collecting a big stake.
Men's Wearhouse also said it plans to
nominate two independent director candidates at Jos. A. Bank's 2014 annual
meeting. Its nominees include former Miller Brewing Co. President and CEO John
Bowlin and Arthur Reiner, who previously served as chairman and CEO of Macy's
Inc.'s East division.
Men's Wearhouse and Jos. A. Bank have been circling each other for months.In September, a few months after Men's Wearhouse Inc. ousted its founder and chairman, George Zimmer, Jos. A. Bank Clothiers Inc. offered to buy its larger rival for $2.3 billion, or $48 per share. Men's Wearhouse turned down that offer, and after Jos. A. Bank dropped the bid, Men's Wearhouse turned the tables with its $55 per share offer.
Hampstead, Md.-based Jos. A. Bank
sells men's tailored and casual clothing and shoes. It's known for ads that say
consumers can buy one suit or sport coat and get three for free. Fremont,
Calif.-based Men's Wearhouse sells men's clothing and suits through its
namesake chain of stores, as well as Moores and the K&G retail chain.
Recently, the company has been going after younger shoppers with suits with
Shares of Jos. A. Bank closed at
$54.41 on Friday. Shares of Fremont, Calif.-based Men's Wearhouse ended at $50.59