This story has been updated from 9:57 am EST with comments from Jos. A. Bank.
NEW YORK (TheStreet) -- The battle for suits continues.
Men's Wearhouse (MW - Get Report) shares were rising Monday after the menswear specialty retailer boosted its takeover proposal for Jos. A. Bank Clothier (JOSB), commencing a cash tender offer for all of the Hampstead, Md.-based company's outstanding shares at $57.50 share, or $1.61 billion. In November, Men's Wearhouse made an offer of $55 a share, for a total of $1.5 billion.
The Houston-based company said in a release Monday that the latest cash offer offers Jos. A. Bank shareholders "substantial value" and "immediate liquidity." The tender offer, commenced by Men's Wearhouse subsidiary Java Corp., expires on March 28.
"Although we have made clear our strong preference to work collaboratively with Jos. A. Bank to realize the benefits of this transaction, we are committed to this combination and, accordingly, we are taking our offer directly to shareholders," said Men's Wearhouse CEO Doug Ewert in the release.
Investors were happy they may finally be getting a deal between the two competitors. Men's Wearhouse shares were up 2.8% to $52.03 at last check. Jos. A. Bank shares were climbing 4.5% to $56.85 on Monday.
Men's Wearhouse is also nominating two independent directors to serve on Jos. A. Bank's board.
The nominees include:
John D. Bowlin, a consumer packaged goods industry veteran, who was previously president and CEO of Miller Brewing Company, and who has held senior executive positions at Kraft Foods North America, Kraft Foods International, Oscar Mayer Food Corporation and General Foods USA.
Arthur E. Reiner has over 40 years of experience in the retail industry and has previously served in various leadership positions with the Macy's (M) organization. He is currently a director at New York & Co. (NWY).
The two companies have been embroiled in a battle of wills since October when Jos. A. Bank first put a combination of the two on the table by offering to buy Men's Wearhouse for $2.3 billion.
Men's Wearhouse rejected that offer and then another proposal for a potentially boosted price when Jos. A. Bank asked to see nonpublic financial information. Men's Wearhouse had adopted a poison pill that would kick into action if a shareholder bought more than 10% of its common shares.
In November, Men's Wearhouse turned the tables and offered its own buyout proposal of Jos. A. Bank, which the smaller competitor recently rejected.
The story has more drama. On Friday, Jos. A. Bank amended its shareholder rights plan -- commonly known as a "poison pill" -- to reduce the ownership threshold to 10% from 20% of outstanding shares.
Jos. A. Bank said its board felt the measures were appropriate "in light of the hostile actions" by its competitor, referring to the Men's Wearhouse late December statement that it would consider all options to complete the merger. Men's Wearhouse said that these options include "nominating director candidates at Jos. A. Bank's next annual meeting of shareholders."
The latest Men's Wearhouse offer represents a 52% premium over Jos. A. Bank's unaffected enterprise value and a 38% premium over Jos. A. Bank's closing share price on October 8, 2013, the day prior to the public announcement of Jos. A. Bank's proposal to acquire Men's Wearhouse, it said Monday."The highly-qualified nominees proposed by Men's Wearhouse have proven track records serving on public company boards, and we believe they will act in the best interest of Jos. A. Bank's shareholders by carefully evaluating the compelling and value creating opportunity represented by the Men's Wearhouse offer," Ewert said in the Monday release. "We urge Jos. A. Bank shareholders to tender into our offer in order to send a strong message that Jos. A. Bank should engage in good-faith negotiations immediately so we can complete this value creating transaction."
Jos. A. Bank confirmed that Men's Wearhouse began an "unsolicited" tender offer of its common stock, in a statement on Monday. The board said it would "carefully review all aspects of the Men's Wearhouse offer in consultation with its financial and legal advisors and make a recommendation to shareholders" by Jan. 17.
Until then, the company told its shareholders to "take no action on the tender offer" until the board announces its recommendation.
Jos. A. Bank hasn't announced the date of its 2014 annual meeting.
--Written by Laurie Kulikowski in New York.