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Jos. A. Bank to acquire outerwear retailer Eddie Bauer — maybe

Outerwear seller Eddie Bauer will be acquired in a deal valued at $825 million by Jos. A. Bank, unless the men’s clothier receives an acquisition offer of its own.

Getty Images (2009)

Outerwear seller Eddie Bauer will be acquired in a deal valued at $825 million by Jos. A. Bank, unless the men’s clothier receives an acquisition offer of its own.

After months of flirting with the idea of combining with a rival, Jos. A. Bank has decided it is better suited for another men's clothing brand.

Or has it?

The chain that's known for its men's suits and two-for-one deals said Friday that it struck a deal to buy the parent company of Eddie Bauer, which sells rugged outerwear. The deal was reached with Everest Topco LLC to buy Everest Holdings LLC in a cash-and-stock deal valued at $825 million.

But the acquisition, which comes as Jos. A. Bank is being pursued by Men's Wearhouse, isn't written in stone: Jos. A. Bank said Friday that it may end the Eddie Bauer deal if it receives an acquisition offer for its company that it feels is superior. It would have to pay a termination fee if it accepted another offer.

"We are looking for a chance to be more important for a specific customer demographic," Jos. A. Bank CEO and president Neal Black said.

The deal comes in the middle of an extended courtship between Jos. A. Bank and Men's Wearhouse that began in October when Jos. A. Bank offered to buy its larger rival for $2.3 billion.

Men's Wearhouse scoffed at that offer, and turned the tables, offering to buy its rival for $1.54 billion. But after Jos. A Bank turned that down, Men's Wearhouse boosted its offer last month to $1.6 billion.

Men's Wearhouse said Friday that it will consult with its legal and financial advisers to evaluate its options with regard to Jos. A. Bank.

Some analysts on Friday questioned why Jos. A. Bank would choose to buy Eddie Bauer, which some believe is past its prime, over Men's Wearhouse.

Eddie Bauer and Jos. A. Bank both cater to similar customers — the 35- to 55-year-old customer that has an annual income of $100,000 to about $125,000 and is budget conscious — but the companies sell different merchandise.

By comparison, Men's Wearhouse and Jos. A. Bank cater to different customers, but they offer similar types of clothing: suits and sport coats.

Jos. A. Bank to acquire outerwear retailer Eddie Bauer — maybe 02/14/14 [Last modified: Friday, February 14, 2014 8:48pm]
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