Apparently, an unsolicited offer of $48 per share was not suited for Men's Wearhouse (NYSE: MW). The leading men's apparel retailer rejected Jos. A. Bank (Nasdaq: JOSB) takeover offer, equating to $2.3 Billion. The bid – an attempt to create a mega-men's apparel retailer – comes mere months after Men's Wearhouse ousted Founder and Chairman George Zimmer during a struggle for power within the company.
"The board and management team are confident that continuing our strategic plan will create more value for shareholders than Jos. A. Bank's inadequate, highly conditional proposal," Douglas S. Ewert, Chief Executive of Men's Wearhouse, said in a company statement denying the offer. Plus, the proposed deal had the potential to create "significant" antitrust concerns, according to Men's Wearhouse.
When Jos. A. Bank's Chairman, Robert N. Wildrick, approached Ewert last month, he argued that both companies would benefit from the greater scale a union would create, The New York Times reported. "We believe Men's Wearhouse's shareholders would want their board to explore with us the immediate and certain value they would receive in a transaction," Wildrick said in a company statement.
However, whereas Men's Wearhouse reported 13 consecutive quarters of growth within its 1,239 stores, Jos. A. Bank reported a 38 percent reduction in profits over the second quarter of this year from its 623 stores. Having twice the number of stores, Men's Wearhouse, "likes the way they look".
Men's Warehouse's Luck Runs Out With '13
How Does Jos. A Bank Beat Men's Wearhouse? Seven 'Free' Suits
Like It Or Not, Men's Wearhouse Will Have To Consider Going Private
Men's Wearhouse Board Says Fired Founder Opposed Big Executive Pay Hikes, Wanted To Take Chain Private
Men's Wearhouse Fires Its 'I Guarantee It' Founder