Men’s Wearhouse Inc. rejected smaller rival Jos. A Bank Clothiers Inc.’s $2.3 billion takeover offer, saying it significantly undervalued the company and could raise antitrust issues.
The offer does not reflect the company’s growth strategy and upside potential, Bill Sechrest, lead director of the Men’s Wearhouse board, said in a statement.
Jos. A. Bank said earlier on Wednesday it had made an all-cash offer of $48 per share to buy its bigger rival, representing a premium of 36 percent to Men’s Wearhouse closing price on Tuesday.
Men’s Wearhouse shares climbed more than 34 percent, or $12.15, to $47.39 in premarket trading. Jos. A. Bank shares also are up 12 percent, or $4.99, to $46.65.
In June, Men’s Wearhouse ousted its chairman George Zimmer — who had also served as the company’s pitchman — following a dispute over the direction for the company.
Zimmer, who founded the company in 1973, used to appear in many of its TV commercials with the slogan, “You’re going to like the way you look. I guarantee it.”
Jos. A. Bank had said in June that it was considering acquisitions and it was storing up capital for a possible deal.
Last month, the company said its fiscal second-quarter net income fell 39 percent as shoppers didn’t respond as well to some of the retailer’s marketing campaigns as they did a year ago.