The hostile on again, off again relationship between Jos. A. Bank Clothiers Inc (NASDAQ:JOSB) and The Men’s Wearhouse, Inc. (NYSE:MW) may be coming to a conclusion.
Jos. A. Bank Clothiers Inc (NASDAQ:JOSB), which yesterday flatly rejected an offer from Men’s Wearhouse of $63.50 per share and was in the process of courting Eddie Bauer, may be open to The Men’s Wearhouse, Inc. (NYSE:MW) advances after all.
Berkshire Hathaway’s Buffett On Diversification
In his 2014 letter preview, Buffett states that, far from being a weak choice, indexing can often achieve investor's goals far more easily than complicated picking strategies. This is a special guest post by Robert R. Johnson, Ph.D., CFA, CAIA. He is a full professor of finance at the Heider College of Business at Creighton Read More
Holding out for higher price
In a press statement, the men’s clothing company said it would be willing to meet with its hostile suitor The Men’s Wearhouse, Inc. (NYSE:MW). “In our Board’s continuing effort to evaluate which alternative transaction would create the greatest value for Jos. A. Bank shareholders, and on the basis of your unsolicited revised proposal indicating a willingness to pay a higher price subject to certain conditions, our Board has authorized our meeting with you to establish a process that will enable you to advise our Board as to the highest price you are prepared to pay in an acquisition of Jos. A. Bank,” the statement said.
In letter Jos. A. Bank lets Men’s Wearhouse know it has other options
In a letter to Men’s Wearhouse, Jos. A. Bank CEO Robert Wildrick was careful to issue an opening to Men’s Wearhouse while at the same time holding out the potential to acquire Eddie Bauer. “The Jos. A. Bank Clothiers Inc (NASDAQ:JOSB) Board has acted in a very careful, thorough and focused manner to evaluate which of various strategic alternatives would create the greatest value for shareholders and serve the best interests of shareholders,” the letter said. “Given the careful attention our Board has paid to maximizing shareholder value, we strongly disagree with your characterization of our Board’s actions. Our Board continues to believe that significant value will be created for our shareholders in our proposed acquisition of Eddie Bauer and the related issuer tender offer. We are also mindful that, unlike The Men’s Wearhouse, Inc. (NYSE:MW)’s proposal, there is no antitrust or other significant obstacle to completing that transaction. “
Readers will recall in Wednesday’s ValueWalk we noted the matter was in the process of heading to court in an expedited fashion. A Delaware judge ruled on Tuesday that the Men’s Wearhouse lawsuit blocking Jos. A. Bank’s acquisition plans to acquire Eddie Bauer could proceed. The acquisition is viewed as an attempt to block The Men’s Wearhouse, Inc. (NYSE:MW) takeover plans of Jos. A. Bank Clothiers Inc (NASDAQ:JOSB), who has been fighting the attempt. We also noted the overlap hedge fund ownership between the two companies was interesting, as they could be playing the game behind the scenes to make sure the deal occurs.
The complex and often volatile relationship between the two competitors may be headed for a happy ending.