American specialty retailer Men’s Wearhouse has now proposed to acquire Jos. A. Bank Clothiers at about $1.2bn, after it rejected the earlier acquisition offer made by Jos. A. Bank Clothiers.

This proposal comes just after ten days after Jos. A. Bank withdrew its offer for Men’s Wearhouse as the board failed to engage in further discussions on the proposal by the deadline of 14 November.

In September this year, Jos. A. Bank had made an unsolicited offer of $48 per share for Men’s Wearhouse.

However, Men’s Wearhouse rejected the bid by citing the offer as ‘opportunistic’ and ‘inadequate.’ It also noted that it undervalues the company and its strong prospects for continued growth and value creation.

Later, the retailer’s board of directors also adopted a ‘poison pill’ in the form of a limited duration shareholder rights plan, declaring a dividend of one right on each share of the company’s common stock outstanding on 21 October.

Men’s Wearhouse Lead Director Bill Sechrest said following Jos. A. Bank’s unsolicited public proposal to acquire Men’s Wearhouse, the Board of Directors evaluated a number of alternatives to deliver value to their shareholders.

"After a thorough review, our Board concluded that an acquisition of Jos. A. Bank by Men’s Wearhouse has strategic logic and the potential to deliver substantial benefits to our respective shareholders, employees and customers,"

The deal will be funded by a combination of cash on our balance sheet and debt financing, Men’s Wearhouse noted.

It added that the offer does not require any costly third-party equity investment and is not conditioned on financing.

The proposed deal will create a combined company that will become the fourth largest U.S. men’s apparel retailer, with more than 1,700 total stores and pro forma sales of more than $3.5 billion.

It will also become a premier men’s apparel retailer with enhanced scale and a broadened customer reach, which is expected to drive significant shareholder value.

Men’s Wearhouse retails men’s sportswear and suits through its namesake chain of stores, as well as the Moores and K&G retail chains. Presently, it operates 1,137 stores across North America.