Men's Wearhouse Turns Hostile With $1.6B Bid

NEW YORK (The Deal) -- Men's Wearhouse (MW) on Monday took its bid for Jos. A. Bank Clothiers (JOSB) directly to its rival's shareholders, submitting a tender offer valuing the Baltimore-based clothing retailer at $1.61 billion.

Fremont, Calif.-based Men's Wearhouse is offering $57.50 per share for Jos. A. Bank, a premium to a $55 per share offer it floated in November and more than 35% above Jos. A. Bank's trading price in early October. Men's Wearhouse also said it intends to nominate two directors to Jos. A. Bank's board for consideration at the company's 2014 annual meeting.

The offer is the latest salvo in a battle between the two companies, sparked early last year by Jos. A. Bank, which offer launched an unsolicited $2.3 billion bid for the larger Men's Wearhouse. The two companies have agreed there is logic to combining the two largest men's formal attire retailers, but haven't been able to see eye-to-eye on valuation or who would be in control of the combination.

Men's Wearhouse said its latest offer values Jos. A. Bank at 9.4 times estimated trailing 12-month Ebitda, and urged Jos. A. Bank to come to the table.

"We believe that our $57.50 per share proposal to acquire Jos. A. Bank is compelling and provides substantial value and immediate liquidity to Jos. A. Bank shareholders," Men's Wearhouse CEO Doug Ewert said in a statement. "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."

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