Jos. A. Bank ends Men’s Wearhouse bid; Eminence Capital wants meeting

Houston – Jos. A. Bank has officially withdrawn its all-cash bid to purchase Men’s Wearhouse for $48 per share, or about $2.3 billion, after failing to get the retailer to enter into merger talks ahead of a Thursday deadline.

Robert N. Wildrick, chairman of the board of Jos. A. Bank, sent a letter to Men’s Wearhouse CEO Doug Ewert informing him that since Men’s Wearhouse had not engaged in good faith negotiations by a previously stated Nov. 14 deadline, Jos. A. Bank would terminate its proposal.

The letter goes on to say Jos. A. Bank will investigate other strategic alternatives and may be willing to consider a new proposal to purchase Men’s Wearhouse if invited by the Men’s Wearhouse board or circumstances change.

In related news, Eminence Capital, the largest Men’s Wearhouse stockholder with 4.7 million shares of the company (almost 10%), has filed a preliminary solicitation statement with the Securities and Exchange Commission (SEC) in connection with calling a special meeting of MW shareholders to vote on a number of bylaw amendments that, if approved, will permit shareholders to remove directors without cause before the next annual meeting of shareholders.

"We are disappointed that Men's Wearhouse has so far failed to engage in merger discussions with Jos. A. Bank,” Ricky C. Sandler, CEO of Eminence Capital, said in a press release. “In light of the Board's actions, we are forced to launch this initiative that will give shareholders the opportunity to effect important corporate governance changes at Men's Wearhouse. In our view the governance changes implemented last month by the Board in response to the premium proposal made by Jos. A. Bank, including the imposition of a super-majority vote for shareholder amendments to the bylaws and implementation of a poison pill with a 10% threshold, are not in the best interests of shareholders. More fundamentally, these actions reflect a troubling mindset by the board and its advisors regarding shareholders' rights.”

Sandler went on to say Eminence continues to encourage the Men’s Wearhouse board to consider all strategic options, including a Jos. A. Bank merger. Jos. A. Bank referred to Eminence Capital’s support for consideration of a merger in its letter to Men’s Wearhouse.

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