* Men's Wearhouse says entered into non-disclosure agreement
with Jos. A. Bank
* Says cos agreed to exchange certain confidential
* Says cos will work in good faith to evaluate potential
March 3 Men's Wearhouse Inc said it was
discussing a proposed merger with smaller rival Jos. A. Bank
Clothiers Inc, after the two men's apparel retailers
spent months bidding for each other.
The companies have entered a non-disclosure agreement to
exchange some confidential information and to work in good faith
to evaluate a potential combination, Men's Wearhouse said on
Men's Wearhouse also said it has received a draft merger
agreement from Jos. A. Bank, but there was no assurance the
discussions will lead to a transaction.
The companies, leaders in a mature market, have bid and
counterbid for each other since October.
Jos. A. Bank rejected Men's Wearhouse's revised $1.78
billion takeover offer last week, but said it would be willing
to discuss a higher bid.
Men's Wearhouse raised its cash tender offer to Jos. A. Bank
shareholders to $63.50 per share from $57.50, and said it could
increase the offer to $65 if it was allowed limited due
The tender offer is scheduled to expire on March 12, unless
Jos. A. Bank started the bidding with an offer to buy Men's
Wearhouse in October. Men's Wearhouse turned the tables with its
own offer and then, in January, went hostile by taking its offer
to Jos. A. Bank's shareholders.
Jos. A. Bank offered to buy outdoor clothing retailer Eddie
Bauer in February in an effort to remain independent, a move
that was criticized by its shareholder Eminence Capital LLC
which has been pushing for a merger with Men's
Eminence is Men's Wearhouse's largest shareholder.
Last week, Men's Wearhouse filed a motion for a temporary
restraining order to prevent Jos. A. Bank from proceeding with
the Eddie Bauer acquisition. ()
Men's Wearhouse has said that its amended offer is
conditional on the termination of Jos. A. Bank's agreement to
buy Eddie Bauer.
Men's Wearhouse operates 1,133 stores in the United States
and Canada. Jos. A. Bank operates 629 stores in 44 states and
the District of Columbia.
Jos. A. Bank's shares rose 0.7 percent to $62.50. They have
gained about 50 percent in the year to their Friday close of
$62.08 on the Nasdaq.
Men's Wearhouse shares have risen about 91 percent to
Friday's close of $53.79 on the New York Stock Exchange.
Men's Wearhouse shares trade at 19.64 times forward
earnings, while Jos. A. Bank's stock trades at 21.41 times.