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Men's Wearhouse To Acquire Jos. A. Bank

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Men's Wearhouse To Acquire Jos. A. Bank

The Men's Wearhouse and Jos. A. Bank Clothiers announced that they have entered into a definitive agreement under which Men's Wearhouse will acquire all of the outstanding shares of common stock of Jos. A. Bank for $65.00 per share in cash, or total consideration of $1.8 billion. The boards of directors of both companies have unanimously approved the transaction.

Together, Men's Wearhouse and Jos. A. Bank will have more than 1,700 stores in the U.S., with approximately 23,000 employees and sales of $3.5 billion on a pro forma basis.

"We are pleased to have reached this agreement with Jos. A. Bank, which we believe will deliver substantial benefits to our respective shareholders, employees and customers," said Doug Ewert, President and Chief Executive Officer of Men's Wearhouse. "Together, Men's Wearhouse and Jos. A. Bank will have increased scale and breadth, and Jos. A. Bank's strong brand and complementary business model will broaden our customer reach. We expect the transaction will be accretive to Men's Wearhouse's earnings in the first full year."

Mr. Ewert continued, "The combined company will have the operational flexibility to successfully execute on strategic plans at both brands. We are excited by the opportunities this transaction presents and are confident that our combined best-in-class offerings for our valued customers will drive significant shareholder value. All of us at Men's Wearhouse have great respect for the Jos. A. Bank management team and are eager to work with Jos. A. Bank's talented employees. I am confident that, together, we will create a truly great company for all of our stakeholders."

Robert N. Wildrick, Chairman of the Board of Jos. A. Bank, said, "Our Board has been rigorously focused on pursuing a path for our shareholders that maximizes value creation. We have been committed to pursuing a range of strategic alternatives to achieve that goal. The transaction we are announcing today clearly reflects the success of our efforts, providing a substantial premium over any price at which our stock has ever traded, including a 56% premium since our interest in Men's Wearhouse became public last October, and allowing our shareholders to receive immediate consideration for their holdings. On behalf of our Board and management team, I would like to express our deep appreciation to our employees for their hard work in making Jos. A. Bank the great company it is today. We look forward to working together with Men's Wearhouse to ensure a smooth transition."

Strategic and Financial Benefits of the Combination

  • Provides compelling value for both companies' shareholders: The combination provides Jos. A. Bank's shareholders immediate liquidity and substantial value for their investment. The transaction represents a 65% premium over Jos. A. Bank's unaffected enterprise value and a 56% premium over Jos. A. Bank's closing share price on October 8, 2013, the day prior to the public announcement of Jos. A. Bank's proposal to acquire Men's Wearhouse. Further, the transaction represents a 10x enterprise value to last twelve months ("LTM") Adjusted EBITDA[1] multiple (assuming an estimated $137 million of Adjusted EBITDA for Jos. A. Bank's fiscal 2013 ending February 1, 2014).[2]

    Men's Wearhouse shareholders will benefit from approximately $100 to $150 million of run-rate annual synergies realized over three years, through improving purchasing efficiencies, optimizing customer service and marketing practices, and streamlining duplicative corporate functions. Additionally, Men's Wearhouse's vertical direct sourcing model will be leveraged to improve combined merchandising and sourcing across the combined company and rationalize inventory over time.
  • Combined company positioned to succeed: The combined company will be the fourth largest U.S. men's apparel retailer with pro forma sales of approximately $3.5 billion. This transaction brings together a high-value collection of national and owned brands. Building on the two companies' complementary business models, the combined company will better serve an expanded customer base in more locations and optimize merchandising and sourcing capabilities.
  • Smooth transition expected: Men's Wearhouse and Jos. A. Bank expect a smooth integration, as there will be no rebranding or remodels required Jos. A. Bank's store banner will remain in place. In addition, the Men's Wearhouse management team has a proven track record of successful acquisitions, having integrated approximately 600 stores and over 7,000 employees in connection with its previous acquisitions of Joseph Abboud, After Hours and Moores. Men's Wearhouse expects to implement the best practices of both companies to drive further operational and financial success. Management will consist of the most qualified individuals from both organizations.

Terms of the Transaction

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Men's Wearhouse Enters Into Non-Disclosure Agreement With Jos. A. BankMen's Wearhouse Enters Into Non-Disclosure Agreement With Jos. A. Bank
March 03, 2014
Men's Wearhouse Invites Jos. A. Bank's to Do It's Due DiligenceMen's Wearhouse Invites Jos. A. Bank's to Do It's Due Diligence
February 28, 2014
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February 26, 2014
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January 30, 2014


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