No doubt Eminence will want to have a say about this, but there is substantial overlap in the shareholdings of each company.Īccording to Capital IQ, BlackRock owns about 9 percent of each company and Vanguard about 6 percent. Going forward, the questions of management and allocating a premium will become paramount. Team is best positioned to execute the integration of our companies” but that the exact management of the companies was up for discussion. Men’s Wearhouse acknowledged this in its news release, stating that “our experienced management These negotiations will turn on which company is the better acquirer and which management team will prevail. Wearhouse is likely to resist such a maneuver because it is the bigger company. The question thus becomes whether this turns into a merger of equals, in which the companies combine through a stock-for-stock exchange with a premium. Shareholders will be on both to reach a deal.

This is also not a case where either company goes hostile the pressure from Bank has no choice but to talk to Men’s Wearhouse, given that the company has acknowledged that a combination is a good idea. So given Men’s Wearhouse’s better footing, how does this play out? That its bid was not contingent on financing. Bank offer would be lower because of decreased leverage and less borrowing. And the cost to Men’s Wearhouse to finance a Jos. To put up $250 million in additional financing. Men’s Wearhouse’s bid also knocks Golden Gate Capital out of the bidding. Of $2.4 billion compared with $1.57 billion for Jos. Men’s Wearhouse is bigger, with a market capitalization The bid by Men’s Wearhouse is an acknowledgment of this fact and highlights that Men’s Wearhouse is arguably better positioned as the acquirer. Shares of Men’s Wearhouse are already up nearly 10 percent, perhaps in support of this argument, and those of Jos. Of Men’s Wearhouse and is agitating for a deal, has stated that the companies are a natural fit that could create up to $2 billion of Bank says it is offering.” Even Ricky Sandler, the chief executive of Eminence Capital, which owns 9.8 percent Bank would be “receptive toīeing bought instead by Men’s Wearhouse if it would pay the same 42 percent premium Jos. Bank’s chairman, Robert Wildrick, told The Wall Street Journal that Jos. BankĪ Pac-Man defense has loomed in the background since Jos. Important, which management team should run the combined operation? And like other Pac-Man situations, the question is, who is the better acquirer, and perhaps even more

In this vein, Men’s Wearhouse’s bid is an acknowledgment that the two companies should be combined. The question is, who becomes the management and which set of shareholders, if any, receive a premium? The typical result of these battles is a combination of the warring companies. It was last seen more than 13 years ago and involved a counteroffer by Elf Aquitaine for Total Fina in 1999 and a counteroffer by the Chesapeake Corporation for Shorewood Packaging Since then, the Pac-Man defense has occasionally been employed by Men’s Wearhouse’s Pac-Man defense is a beloved tactic that first arose in the 1980s during the legendary Martin Marietta-Bendix battle.

Bank Clothiers, offering to acquire the company, which had previously bid to acquire Men’s Wearhouse. Men’s Wearhouse has turned the tables on Jos. Credit Toddĭeal aficionados have a Thanksgiving present. The Pac-Man takeover defense is a beloved tactic that first arose in the 1980s.

Pac man intermission music two hours