NEW YORK (The Deal) -- Jos. A. Bank Clothier (JOSB) is still shopping for acquisitions despite the termination of its $48 per share, $2.3 billion offer for Men's Wearhouse, Gilbert Harrison, chairman of investment bank Financo said Friday.
Financo, along with Goldman, Sachs & Co. (GS), is Hampstead, Md.-based Jos. A. Bank's financial adviser.
Destination XL Group (DXLG), formerly known as Casual Male Corp., with a market cap of about $320 million and also a purveyor of men's wear, has been reported to be a potential target.
Harrison said he couldn't comment on specific targets. He also declined to say whether private equity firm Golden Gate Capital might be on board for a deal other than Men's Wearhouse, though he did say that the two entities have an "extremely good relationship."Despite looking for additional targets, Jos. A. Bank would still consider making a new offer for Men's Wearhouse, were the Houston-based company to change its mind, Harrison added. He emphasized, however, that the deadline for the $48 per share offer has not been extended. In terminating its outstanding offer for Men's Wearhouse, Jos. A. Bank chairman Robert Wildrick on Friday said in a statement that were the target to invite it back to the table, it "would consider whether a new proposal ... is warranted." Harrison pointed out that the advisers didn't even get to the point of discussing alternative deal structures, such as offering stakes in a merged company to Men's Wearhouse shareholders, because the target never engaged in a dialogue. Instead, Men's Wearhouse passed a poison pill and refused to even meet with Jos. A. Bank since the confidential offer was made on Sept. 18. Jos. A. Bank went public in October with the offer, which Men's Wearhouse rejected as undervaluing the company. At the end of the last month, Jos. A. Bank said it would consider raising its bid if allowed to conduct "limited" due diligence, but that its offer would terminate on Nov. 14. Doug Ewert, chief executive of Men's Wearhouse, said in a Nov. 4 statement that Men's Wearhouse believes its own strategic plan would create more value for shareholders than the buyout offer. But Men's Wearhouse board - now famed for its poor judgment in publicly ousting founder George Zimmer in late June when he suggested a sale to private equity - only bought itself a new headache with its rejection of another deal. Eminence Capital, which has a 9.8% stake in Men's Wearhouse, just short of the poison pill threshold, took a shot at the board, saying in a Friday statement, "the board has confirmed that it is not committed to exercising its basic fiduciary duties to shareholders and is satisfied with the status quo." The activist investor on Friday also filed a preliminary solicitation statement to call a special meeting of shareholders. Under Texas law, a special meeting to amend bylaws and make it easier to remove directors can be called by holders with at least 10% of shares. "We are disappointed that Men's Wearhouse has so far failed to engage in merger discussions," Eminence CEO Ricky Sandler said. "In light of the board's actions, we are forced to launch this initiative that will give shareholders the opportunity to effect important corporate governance changes at Men's Wearhouse." Written by Richard Collings
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV