Footwear group Maxwell Shoe Company Inc has rejected a $300 million unsolicited takeover bid from Jones Apparel Group Inc, saying the offer of $20 per share was inadequate and not in the best interests of Maxwell shareholders.

According to Maxwell, the proposal price represented a premium of only 8.7 per cent over its $18.40 common stock closing price on the day before Jones Apparel publicly announced its intention to purchase the company.

In addition, Maxwell argued that Jones Apparel's proposal did not adequately compensate stockholders for costs associated with transferring control of the company, and significantly undervalued the strength and diversity of the company's brand portfolio.

"Maxwell Shoe Company's board and management are focused on building value for our stockholders and, in our view, Jones's proposal does not recognise the value of our company," Maxwell CEO Mark Cocozza said.

"Notably, the marketplace appears to agree."

Maxwell's stock price closed at $22.20 per share on March 11, 2004, an 11 per cent increase over Jones Apparel's proposed purchase price.