FTC waives off Men's Warehouse's HSR Act waiting period

31 May '14

2 min read

The Men's Wearhouse announced that the Federal Trade Commission has granted termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, ("HSR Act") applicable to Men's Wearhouse's proposed acquisition of Jos. A. Bank Clothiers.

As previously announced, Men's Wearhouse and Jos. A. Bank entered into a merger agreement pursuant to which Men's Wearhouse would acquire all of the outstanding shares of common stock of Jos. A. Bank for $65.00 per share in cash, or total consideration of $1.8 billion, pursuant to a cash tender offer. Together, Men's Wearhouse and Jos. A. Bank will have more than 1,700 stores, with approximately 26,000 employees and sales of $3.5 billion on a pro forma basis.

"We are pleased to have received the termination of the HSR Act waiting period and expect to close the transaction within approximately the next 30 days," said Doug Ewert, President and Chief Executive Officer of Men's Wearhouse. "Together, Men's Wearhouse and Jos. A. Bank will have increased scale and breadth, and Jos. A. Bank's strong brand and complementary business model will broaden our customer reach.

“Men's Wearhouse shareholders will benefit from approximately $100 to $150 million of run-rate annual synergies realized over three years, through improving purchasing efficiencies, optimizing customer service and marketing practices, and streamlining duplicative corporate functions. Additionally, Men's Wearhouse's vertical direct sourcing model will be leveraged to improve combined merchandising and sourcing across the combined company and rationalize inventory over time. We expect the transaction will be accretive to Men's Wearhouse's earnings in the first full year."

The termination of the HSR Act waiting period satisfies one of the conditions to consummate the tender offer. Completion of the tender offer remains subject to certain other conditions as described in the offer to purchase disseminated to stockholders of Jos. A. Bank, including the completion of the marketing period, which commenced today and is expected to end on June 19, 2014, unless earlier waived. The tender offer is currently scheduled to expire at 5:00 p.m. New York City time, on June 5, 2014, unless extended.

BofA Merrill Lynch and J.P. Morgan Securities LLC are serving as financial advisors to Men's Wearhouse, and Willkie Farr & Gallagher LLP is serving as legal advisor.

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