Men’s Wearhouse Jumps on Hiring Bank to Seek K&G OptionsChris Burritt
Men’s Wearhouse Inc. climbed the most in more than 15 months after saying it hired investment-banking firm Jefferies & Co. to explore strategic alternatives for its K&G store chain.
The shares advanced 19 percent to $34.62 at the close in New York, for the biggest jump since Dec. 7, 2011. The Houston-based retailer of men’s suits and sportswear has advanced 11 percent this year, while the Standard & Poor’s Smallcap 600 Index has gained 10 percent.
Chief Executive Officer Doug Ewert is considering options for K&G, which sells men’s, women’s and children’s apparel, after the unit’s comparable-store sales fell 5.7 percent in the fourth quarter, according to a company statement yesterday. Men’s Wearhouse plans to focus efforts on its MW and Moores chains selling men’s apparel.
“Sales at K&G were disappointing as customers did not respond to our promotions and new marketing campaign as well as expected,” Ewert said in the statement.
The company can offer no assurance it will enter a transaction involving K&G, according to the statement. The division operated 97 stores as of Feb. 2, generating 16 percent of total revenue. Men’s Wearhouse operated at 1,143 total stores.