Despite being the target of a takeover bid by Jos. A. Bank Clothiers Inc (NASDAQ:JOSB), a takeover that could ultimately turn hostile, The Men’s Wearhouse, Inc. (NYSE:MW) is looking at the possible acquisition of high-end shoe retailer Allen Edmonds. The news was first reported by The Wall Street Journal and it appears as though Men’s Wearhouse isn’t putting too much into the unsolicited bid by Jos. A. Bank to acquire the clothes retailer. That being said, the deal for Allen Edmonds wouldn’t scare Jos. A. Bank away given that the deal is only expected to reach the low hundreds of millions for the privately-held shoe seller.
Jos. A. Bank offer for Men’s Wearhouse
Jos. A. Bank has tendered an offer of $2.3 billion for The Men’s Wearhouse, Inc. (NYSE:MW) and could certainly, and may have to, offer more if it’s to succeed in acquiring the clothing retailer which has rebuffed its advances.
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The Men’s Wearhouse, Inc. (NYSE:MW) and Jos. A. Bank Clothiers Inc (NASDAQ:JOSB), who operates over 500 retail locations along with internet and catalog sales, have not sat down to negotiate in weeks and there is no word as to whether or not they might go fully hostile. Sources close to the dealings suggest that Jos. A. Bank hasn’t ruled out anything yet.
The size of the deal that Men’s Wearhouse is considering would not be viewed as a takeover defense; rather, it falls in line with its existing acquisition strategy that saw Men’s Wearhouse pay $97.5 million this year for men’s clothing brand Joseph Abboud.
Allen Edmonds acquisition target
The Men’s Wearhouse, Inc. (NYSE:MW) has been forging a path into upscale clothing brands for some time now and Allen Edmonds makes sense as an acquisition target. The Port Washington-based dress shoe maker has famously sold its footwear to presidents from Bill Clinton to Ronald Reagan.
Any deal for Allen Edmonds would have to go through the private equity firm Goldner Hawn Johnson & Morrison which purchased the company for around $100 million in 2006.
Men’s Warehouse is undergoing a number of changes including ridding itself of George Zimmer, who founded the company in 1973. After the move the, company stated that Zimmer was dismissed due to “difficulty accepting the fact that The Men’s Wearhouse, Inc. (NYSE:MW) is a public company with an independent board of directors and that he has not been the chief executive officer for two years. He advocated for significant changes that would enable him to regain control.”