In October 2013 Jos A Bank Clothiers, Inc made an unsolicited $2.3 billion offer to acquire The Men's Wearhouse, Inc, which precipitated a flurry of competing acquisition offers and takeover defences by the competing clothing retailers. Men's Wearhouse ultimately rejected Jos A Bank's offer as undervaluing Men's Wearhouse and instituted a shareholder rights plan with a 10% trigger.
On November 15 2013 Jos A Bank formally withdrew its offer to acquire Men's Wearhouse. After Jos A Bank withdrew its offer, Men's Wearhouse's largest stockholder, Eminence Capital, stated publicly that it was in favour of a transaction between the two companies, and that it would seek to vote out certain incumbent Men's Wearhouse directors if no deal occurred. Shortly after Jos A Bank withdrew its offer, Men's Wearhouse dusted off the so-called 'Pac-Man defence', which was a popular takeover defence tactic in the 1980s, and offered to acquire Jos A Bank for $1.5 billion, or $55 per share. Mirroring Men's Wearhouse's prior response, Jos A Bank rejected the offer as insufficient and lowered the trigger on its shareholder rights plan from 20% to 10%. Men's Wearhouse subsequently raised its unsolicited offer to $57.50, and commenced a hostile tender offer for Jos A Bank shares at that price, with the tender offer set to expire on March 28 2014. Eminence Capital has publicly supported Men's Wearhouse's renewed offer, and has stated its intention to nominate two directors to the Jos A Bank's board. As of this update, Jos A Bank's board is considering this new proposal and has requested that its stockholders not participate in the hostile offer until the board determines how to proceed.
For further information on this topic please contact Peter L Welsh or Jane D Goldstein at Ropes & Gray LLP's Boston office by telephone (+1 617 951 7000), fax (+1 617 951 7050) or email ([email protected] or [email protected]). Alternatively, contact Jason Freedman or Robert Moreno at Ropes & Gray LLP's San Francisco office by telephone (+1 415 315 6300), fax (+1 415 315 6350), or email ([email protected] or [email protected]).The Ropes & Gray LLP website can be accessed at www.ropesgray.com.
