Sealy Divests Operations in France, Italy

November 18, 2010  by in UnCategorized   

By Home Furnishings Business in Bedding on November 19, 2010 Sealy Corp. (NYSE: ZZ) has sold its European manufacturing operations in France and Italy to a privately held Italian company.

The operations of SAPSA Group Srl will remain a Sealy partner through a licensing agreement in Europe that excludes the U.K., Ireland, Channel Islands and Isle of Man.

The transaction closed Thursday, Nov. 18.

"After carefully reviewing the alternatives available to us, we concluded that a divestiture provided the greatest opportunities for Sealy and SAPSA," said Larry Rogers, Sealy president and CEO. "Our decision to divest SAPSA enables us to better focus our resources on the areas of our business that are aligned with our greatest growth opportunities."

Rogers said the divestiture will allow the company to improve its EBITDA and reduce debt.

"We are also excited for the SAPSA business as we believe that the new ownership team, whose management has significant European operating experience, will provide it with renewed energy," he said. "We look forward to a profitable long-term relationship with SAPSA and expect the new relationship to benefit SAPSA's customers, employees and suppliers."

Through the first nine months of fiscal 2010, Sealy's European segment generated net sales to external customers of $76.8 million and reported a loss of $25.2 million before interest expense, income taxes, depreciation and amortization, which includes an impairment charge of $23 million.

"I am excited about the opportunity to take over leadership of SAPSA," said Andrea Chalp, the new president of SAPSA Group. "I believe the company has terrific future growth prospects and look forward to working closely with our dedicated employees to deliver superior product and service to our valued customers. We are committed to developing a long and productive partnership with Sealy as we continue to build the Sealy Brand in Europe."

The entire press release can be found online.