Antitrust issues a risk for menswear merger battle
Jos. A. Bank raised doubts Sunday about whether the federal government will approve the takeover bid by rival clothier Men's Wearhouse.
Jos. A. Bank Clothiers said that Men's Wearhouse had yet to explain why the Federal Trade Commission would approve the proposed combination because of antitrust concerns.
Directors for Jos. A. Bank noted in a letter that the FTC had sent Men's Wearhouse a second request for information as part of its antitrust review.
"It is a very serious step for the FTC to issue a second request," the letter said. "Our two companies' stockholders should understand that second requests are issued in less than 2% of all transactions filed with the government and a high percentage of those transactions are never completed."
The two retailers have been dueling since October when Jos. A. Bank, based in Hampstead, Md., offered $2.3 billion for Men's Wearhouse.
Men's Wearhouse, based in Fremont, Calif., rejected that bid and also cited antitrust issues. It then countered with a $1.61 billion offer to buy Jos. A. Bank. That offer was rejected last month for being too low, leading Men's Wearhouse to send a letter Thursday saying it would be willing to raise its offer.
Jos. A. Bank sells men's tailored and casual clothing and shoes and is known for ads that say consumers can buy one suit or sport coat and get three for free. Men's Wearhouse runs its namesake chains as well as the Moores and the K&G chains.
A representative for Men's Wearhouse did not respond to an email seeking comment.