Men’s Wearhouse said on Monday that it had reached a nondisclosure agreement with Jos. A. Bank Clothiers, setting up talks that could lead to a merger of the two menswear retailers and end a monthslong merger standoff.
As part of the accord, Jos. A. Bank submitted a draft of a merger agreement to Men’s Wearhouse.
The confidentiality agreement will finally allow the two to begin sharing sensitive business information, after Jos. A. Bank said last week that it was willing to entertain discussions with its unwanted rival if they could lead to a higher takeover bid.
Men’s Wearhouse is currently offering $63.50 a share, or about $1.8 billion, a level that Jos. A. Bank has called too low. But Men’s Wearhouse has left open the possibility of raising that bid to $65 a share.
The move is the latest turn in a drama that began with an unsolicited - and ultimately failed - bid by Jos. A. Bank to buy Men’s Wearhouse, its larger rival. Men’s Wearhouse then turned the tables, going hostile with its own takeover offer.
As a defensive measure, Jos. A. Bank agreed last month to buy the outdoor goods retailer Eddie Bauer for $825 million. But that deal was intended in part as a move to elicit a higher takeover bid from Men’s Wearhouse, a person briefed on the matter said previously.
