Jos. A. Bank issues response to Men’s Wearhouse rejection
The Men’s Wearhouse has rejected Jos. A. Bank’s offer to acquire the retailer for about $2.3 billion in a $48 per share all-cash offer, and Jos. A. Banks is not taking no for an answer.
The acquisition would create a men’s apparel powerhouse with more than 1,700 stores across the nation. However, the Men’s Wearhouse said in a press release that the unsolicited offer significantly undervalues the company, is inadequate and not in the best interests of the company or its shareholders.
“After careful review and deliberation, our board of directors has determined that Jos. A. Bank's proposal significantly undervalues Men's Wearhouse and fails to reflect the company's growth strategy and upside potential," said Bill Sechrest, lead director of the board. "We believe Jos. A. Bank's unsolicited proposal is opportunistic, subject to unacceptable risks and contingencies, and would deprive our shareholders of the value inherent in Men's Wearhouse for inadequate consideration."
Jos. A. Bank calls the rejection “inexplicable.”
"Our proposal provides substantial, immediate, and certain value for Men's Wearhouse shareholders. We are proposing a 42% premium to the closing price of Men's Wearhouse's common stock on the day before we made our acquisition proposal,” read the latest release from Jos. A. Bank. “Our price is significantly greater than the highest price at which Men's Wearhouse's stock has traded over the last five years. Yet, the Men's Wearhouse board asserts that our proposal undervalues their company! Based on today's market reaction and the strong statements of support that have been made since we announced our proposal this morning, we don't believe that the stockholders of Men's Wearhouse share that view at all.”
Jos. A. Bank’s release goes on to state that “the formulaic, knee-jerk rejection by Men's Wearhouse, and their refusal to even discuss [the] proposal, do not serve the interests of their shareholders or their customers.” The company urged the need for further consideration and discussion.
Jos. A. Bank operates 623 stores in 44 states and the District of Columbia, a nationwide catalog and an e-commerce website. The Men’s Wearhouse operates 1,137.