From Home Furnishing Business
Tempur Sealy Gains European Brand Rights
Bedding major Tempur Sealy International (NYSE: TPX) has signed a definitive agreement to acquire the Sealy brand rights in continental Europe (excluding the United Kingdom) from its former licensee.
The company anticipates closing the transaction, which is subject to customary closing conditions, during its fiscal second quarter of 2014. Financial terms were not disclosed.
As part of the transaction, the companies have executed a supply agreement, whereby the former licensee will become a contract manufacturer for certain Sealy branded products. No assets were acquired.
"The acquisition of Sealy brand rights in Continental Europe represents a significant long-term growth opportunity," said Mark Sarvary, CEO of Tempur Sealy International, Lexington, Ky. "We are excited at the prospects of further increasing our European presence and will leverage Tempur International's European sales and marketing infrastructure to grow it in the years to come."
"Given our current expectation for when the deal will close and the nature of the transaction, we expect this geographic expansion to have limited sales and earnings contribution to our overall results in 2014," said Chief Financial Officer Dale Williams. "However, we expect sales and earnings contribution to be more significant in 2015 and beyond as we broaden our product offering and increase distribution."
Tempur Sealy International is the world's largest bedding provider. Its brands include Tempur, Tempur-Pedic, Sealy, Sealy Posturepedic, Optimum and Stearns & Foster.