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Wearhouse, Bank and Bauer: a case for the books

The months-long M&A saga involving Jos. A. Bank and Men’s Wearhouse, if it ever ends, will likely be a case for the business textbooks, one analyst said.

Jos. A. Bank

(The Daily Record/Patty Irwin)

“I’ve been pretty surprised by all this,” said Richard Jaffe, retail analyst for Stifel Nicolaus. “From a defense-offense-defense-offense, it’s been pretty interesting.”

The exchange began in October, when Bank’s offer to acquire the Wearhouse went public — a move which the latter countered in November, with an offer to acquire Bank.

On Valentine’s Day 2014, it became a triangle, when Jos. A. Bank announced its plans to acquire outerwear company Eddie Bauer — unless, of course, a better offer along for Bank itself.

It’s a tale filled with colorful terms like “Pac Man defense” and “poison pill.” It includes a diversion, Jaffe said — “you can’t buy us, because we’re going to buy something else.”

It’s nothing new, he said, but it’s been a while since he’s noticed these tactics in play.

“All of these are sort of classic maneuvers from 1980s M&A… to see them all taking place at once is kind of interesting,” said Jaffe.

It’s even more interesting for younger analysts, said Jaffe, who may not have seen these strategies in action.

“It’s going to be an interesting case study once the dust settles,” he said.

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