Houston — Mattress Firm Holding Corp., the nation’s largest specialty mattress retailer, has entered into an agreement to acquire all of the outstanding equity interests in HMK Mattress Holdings LLC, the holding company of Sleepy’s, for $780 million. Sleepy’s is the nation’s second largest specialty mattress retailer, with more than 1,050 stores in 17 states in the Northeast, New England the Mid-Atlantic and Illinois.
The closing of the acquisition is expected to occur during the first half of Mattress Firm’s fiscal year 2016. Adam Blank, the current chief operating officer and general counsel of Sleepy’s, will join the Mattress Firm executive management team.
The company plans to continue to operate under both the Mattress Firm and Sleepy’s brands in the near term and will maintain an East Coast office on Long Island, N.Y.
“This transformational acquisition unites the nation’s two largest mattress specialty retailers, providing customers with convenience, value and choice through our truly border-to-border and coast-to-coast, multi-brand retail stores and distribution network,” says Steve Stagner, Mattress Firm’s chief executive officer. “Over the years we have admired Sleepy’s for the strong business they have built. The Acker family has a long history in the mattress specialty retail industry through four generations and over 58 years. I look forward to partnering with David Acker during this transition period, as we bring together these two great companies that share a strong focus on culture, the customer and overall service experience.”
Stagner continues: “The acquisition of Sleepy’s is an important next step in building our national store network, and expands our footprint into major markets in the Northeast and Mid-Atlantic. With pro forma sales of over $3.6 billion through approximately 3,500 retail locations in 48 states, our combined company will be able to further benefit from national scale in key areas including distribution, customer delivery, advertising, sourcing and procurement and operating expenses.”
Barclays acted as exclusive financial advisor to Mattress Firm. Norton Rose Fulbright LLP acted as legal counsel to Mattress Firm in connection with the transaction. Morgan Stanley & Co. LLC acted as exclusive financial advisor to Sleepy’s. Gibson, Dunn & Crutcher LLP acted as legal counsel to Sleepy’s in connection with the transaction.
With more than 2,400 company-operated and franchised stores across 41 states, Mattress Firm Holding Corp. has the largest geographic footprint in the United States among multi-brand mattress retailers. Founded in 1986, Houston-based MFRM is the nation’s leading specialty bedding retailer whose brands include Mattress Firm and Sleep Train. For more information, visit www.mattressfirm.com.
Sleepy’s is a privately-owned fourth-generation company with over 1,050 retail locations in 17 states and the District of Columbia, spanning from Maine to South Carolina. For more information, visit www.sleepys.com.
SOURCE: Mattress Firm