Men's Wearhouse stitches up deal to buy Jos. A. Bank
By Siddharth Cavale, Olivia Oran and Aditi Shrivastava
(Reuters) - Men's Wearhouse Inc said it would acquire rival Jos. A. Bank Clothiers Inc for about $1.8 billion, ending a five-month saga that started with Jos. A. Bank offering to buy its larger menswear rival.
The companies, operating in a mature market, have bid and counterbid for each other since October when Jos. A. Bank offered to buy Men's Wearhouse for about $2.3 billion.
The increased offer price of $65 per share announced on Tuesday is a premium of 5.1 percent to Jos. A. Bank's Monday closing price. But it is 56 percent more than the stock's price in October before the merger battle began.
Men's Wearhouse, which had previously offered $63.50 per share, said the deal would create the fourth-largest men's apparel retailer in the United States with annual sales of about $3.5 billion.
The company expects to save $100-$150 million annually for three years as a result of the deal.
Men's Wearhouse shares closed up 4.7 percent at $57.14 on the New York Stock Exchange on Tuesday. Jos. A. Bank shares closed up 3.9 percent at $64.22 on the Nasdaq.
"It's a second Christmas for Jos. A. Bank shareholders," Jerry Reisman, an M&A expert at law firm Reisman Peirez Reisman and Capobianco LLP, told Reuters.
Men's Wearhouse will be able to close stores duplicated in the same mall, reducing costs in the long term, he said. Continued...