Tempor Sealy buys The Mattress Firm in a $4 billion deal

LEXINGTON, Ky.; – Tempur Sealy International, the industry’s largest supplier of bedding, has signed an agreement to purchase The Mattress Firm, the industry’s largest sleep retailer, in a $4 billion stock and cash deal.

The takeover has been a topic of discussion within the industry for a number of years and has grown in scale and detail since the first of this year. The deal will give Tempur Sealy direct ownership of its largest retail partner and control of more than 2,300 Mattress Firm stores and e-commerce sites. More importantly, with the acquisition, Tempur Sealy has captured a significant market share.

“This transaction advances all four of our key long-term initiatives: developing high-quality bedding products, promoting brands through compelling marketing, improving our diverse multi-channel distribution system, and driving growth EPS”. . “In line with our merger and acquisition strategy, this acquisition will make Tempur Sealy more competitive by bringing us closer to consumers and facilitating continuous innovation.

“We are excited about the long-term growth prospects of our vertically integrated global company,” he said. This combination will accelerate our growth trajectory and enhance our operating cash flow. Mattress has been a valued retail partner for over 35 years, and we look forward to welcoming its talented workforce of over 8,100 employees to the Tempur Sealy family.”

The transaction will be funded with approximately $2.7 billion in cash consideration and $1.3 billion in consideration issued to Mattres shareholders, reflecting the issuance of approximately 34.2 million shares of Tempur Sealy common stock based on a closing price of $37.62 per share as of yesterday, 8 May.

“We know that every customer has unique needs and desires when it comes to the perfect sleep solution for them,” said John Eck, CEO of The Mattress Firm. “As part of Tempur Sealy, our customers will benefit from our combined portfolio of highly recognized brands and products, comprehensive omni-channel capabilities, industry-leading innovation and best-in-class teams. Under Tempur Sealy’s leadership, our combined company will be uniquely positioned to leverage our shared values ​​and complementary capabilities. To better meet consumer needs and drive growth.”

Following the transaction, Mattress Firm’s and Tempur Sealy shareholders will own approximately 16.6% and 83.4% of the combined company, respectively, based on the company’s shares outstanding at the time of signing. Tempur Sealy expects to expand its existing Board of Directors by appointing mutually agreed directors of Mattress Firm to the Tempur Sealy Board following the closing of the transaction.

Both boards have approved the acquisition, and the transaction is expected to close in the second half of 2024. Mattress Firm shareholders who own more than 80% of Mattress Firm shares have signed voting agreements in support of the transaction. The transaction does not require the approval of Tempur Sealy shareholders.

The company said the acquisition will enhance Tempur Sealy’s ability to meet consumer needs, expand growth opportunities, and streamline operations. “

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