US: Men's Wearhouse prepared to up offer for Jos A Bank
In a letter to Jos A Bank's independent directors yesterday (30 January), Men's Wearhouse CEO Douglas Ewert reiterated that it had submitted a "compelling" all-cash offer to acquire the company for US$57.50 per share. This was lifted last month from its November offer of $55.
However, weeks ago, Jos A Bank rejected the offer, claiming it was "inadequate" from a financial point of view and "not in the best interest" of its stockholders.
In his letter to the directors, Ewert said the offer delivers "significant" value to the company's shareholders that is "superior" to what he believes the firm could reasonably expect to create as a standalone company.
He added: "We are prepared to increase our offer price if you can demonstrate or we can discover additional value through discussions or limited due diligence."
Ewert reiterated that it is "fully committed" to a transaction. "If the fact that we have launched a tender offer at an increased price and nominated two highly qualified independent directors to your board hasn't convinced you, we encourage you to engage in discussions with us. We are quite confident that such a discussion would make it crystal clear how committed we are to making this combination a reality."
The CEO called for the company to form a special committee of independent directors and "enter constructive negotiations" with Men's Wearhouse "immediately".
The rejection of the offer earlier this month is the latest move in a long-running battle between the two retailers.
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