Jos. A. Bank is dropping its takeover bid for Men’s Wearhouse — sort of.
The men’s suit retailer said Friday it has withdrawn its $2.3 billion offer for its Houston-based rival after the latter failed to respond to a Nov. 14 deadline it had set for negotiations.
But it wasn’t an off-the-rack withdrawal. Jos. A. Bank quickly added that it was still available for talks should its rival change its mind.
“If, in the future, we are invited by the Men’s Wearhouse board to discuss our acquisition of Men’s Wearhouse, or if circumstances were otherwise to change, Jos. A. Bank may consider whether a new proposal to acquire Men’s Wearhouse is warranted,” the company said.
Activist shareholder Ricky Sandler, whose hedge fund Eminence Capital disclosed a 9.8 percent stake in Men’s Wearhouse last month, seized on the news as an opportunity to pressure the 1,100-store chain into negotiations.
Sandler will force a special Men’s Wearhouse shareholder meeting early next year in a bid to oust clammed-up board members who have ignored the offer from the 611-store chain, the fund said in a regulatory filing Friday.
“By allowing [Thursday’s] deadline to expire, the board has confirmed that it is not committed to exercising its basic fiduciary duties to shareholders and is satisfied with the status quo,” Sandler wrote Friday.
Sandler said in the filing he is looking to amend company bylaws so that shareholders can remove directors without cause with a majority vote. Currently, the standard is two-thirds.
Judging by the reaction of the stocks of both companies, investors don’t believe Bank’s bid is shot.
Men’s Wearhouse shares rose 1.1 percent, to $46.63, just under the $48-a-share bid. Bank shares rose about 1 percent, to $50.72.
Bank argues a combination could reduce administrative costs and create efficiencies. But Men’s Wearhouse has called the buyout offer “inadequate” and voiced concerns about recent sales declines at Bank.