FREMONT, Calif. — The rocky courtship to combine two men’s clothing companies took a step forward Monday, with The Men’s Wearhouse boosting its offer to acquire Jos. A. Bank to $1.61 billion.
Analysts say a combination is inevitable, even though each chain has had previous offers to acquire the other rebuffed. A deal would enable both chains to cut costs and boost profits in an increasingly competitive market. But so far executives have been unable to hammer out a deal.
‘‘Anybody who follows corporate America can see that these two companies have to be joined,’’ said Brian Sozzi, an analyst at Belus Capital Advisors. ‘‘They are specialty retailers in a price-competitive industry with limited growth prospects.’’
The Men’s Wearhouse Inc. is now offering $57.50 per share for Jos. A. Bank, up from its previous offer of $55 per share, or $1.54 billion. Jos. A. Bank rejected the lower offer in late December. Men’s Wearhouse said it is taking the bid directly to Jos. A. Bank Clothiers Inc. shareholders. It also plans to nominate two people to the Jos. A. Bank board.
‘‘We are committed to this combination,’’ Men’s Wearhouse chief executive Doug Ewert said in a statement.
Jos. A. Bank said in a statement it is reviewing the offer and will make a recommendation for shareholders by Jan. 17.
Jos. A. Banks was the first to express interest in a combined company. In September, a few months after Men’s Wearhouse Inc. ousted its founder and chairman, George Zimmer, Jos. A. Bank Clothiers Inc. offered to buy its larger rival for $2.3 billion, or $48 per share. Men’s Wearhouse turned down that offer.
Jos. A. Bank, based in Hampstead, Md., sells men’s tailored and casual clothing and shoes and is known for ads that say consumers can buy one suit or sport coat and get three for free.
Men’s Wearhouse, which is based in Fremont, Calif., also owns Moores and the K&G chains. It has been going after younger shoppers with suits featuring slimmer silhouettes.
Stifel Nicolaus analyst Richard Jaffe said it’s likely the two companies will combine.
‘‘The benefit of taking over your largest rival and becoming the largest specialty retail channel for men’s clothing is significant, albeit difficult to quantify,’’ he wrote in a client note.