Jos. A. Bank said on Thursday that its board had rejected Men’s Wearhouse‘s newest takeover bid, worth nearly $1.8 billion, but said that it was willing to meet to try and agree on a higher price.
The move is the latest turn in a drama that has played out publicly for months, beginning with Jos. A. Bank making an unsolicited and ultimately failed bid to buy its larger rival. Men’s Wearhouse then turned the tables, going hostile with its own takeover offer.
Earlier this month, Jos. A. Bank instead announced a plan to buy Eddie Bauer for $825 million, a maneuver intended to  both  frustrate its unwanted suitor’s hostile advances and goad Men’s Wearhouse into offering more money.
That happened earlier this week, when Men’s Wearhouse raised its takeover bid to $63.50 a share from $57.50 a share.
In a letter sent to its rival’s board on Thursday, Jos. A. Bank wrote that it considered even the latest offer too low, and that it considered the Eddie Bauer deal likely to generate real value for shareholders. But the menswear retailer added that, since its fellow suit seller had indicated a willingness to bid even more under certain conditions, it was willing to open talks.
Jos. A. Bank’s ability to break off the Eddie Bauer deal arises from several escape hatches built into that transaction, including the right to walk away if an offer that promises more value for its shareholders â€" namely a high-enough bid from Men’s Wearhouse â€" emerged.
Jos. A. Bank added that it would afford its suitor only a limited amount of time to act.
“Given the compelling nature of the Eddie Bauer transaction from a shareholder value creation standpoint, and in light of its certainty of closing, we are only prepared to give you a limited amount of time to come forward with your best offer,†Robert Wildrick, the company’s chairman, wrote in the letter.
