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From Home Furnishing Business
Tempur Sealy Gives Update on Mattress Firm Acquisition
September 23,
2024 by Karen Parrish in Business Strategy, Industry 
Tempur Sealy International, Inc. (NYSE: TPX, "Company" or "Tempur Sealy") provided an update with respect to the Company's agreement to acquire Mattress Firm Group Inc. ("Mattress Firm"), which is currently being challenged in federal court by the Federal Trade Commission ("FTC").
The litigation process continues to progress, with hearings currently scheduled to begin on November 12, 2024, and expected to last two weeks. The Company continues to believe that a successful litigation process can be completed in the coming months, which would allow the transaction to close in late 2024 or early 2025, consistent with previous expectations.
In conjunction with the planned Mattress Firm acquisition, Tempur Sealy has entered into a purchase agreement with MW SO Holdings Company, LLC ("Mattress Warehouse"), a leading independently owned bedding specialty retailer, for the sale of 73 Mattress Firm retail locations and the Company's Sleep Outfitters subsidiary, which includes 103 specialty mattress retail locations and seven distribution centers.
Mattress Warehouse is a multi-branded retailer offering a full array of mattresses at various price points. Tempur Sealy will continue to supply its Tempur-Pedic, Stearns & Foster, and Sealy products to the divested Mattress Firm and Sleep Outfitters stores. The divestiture is subject to the closing of Tempur Sealy's acquisition of Mattress Firm and other customary closing conditions. It is expected to close approximately one quarter after the closing of the Mattress Firm transaction.
Company Chairman and CEO Scott Thompson commented, "As part of our engagement with the FTC on the proposed acquisition of Mattress Firm, we conducted a divestiture process, which led to an agreement with Mattress Warehouse, a company with extensive mattress retail experience, a strong capital base, and a capable leadership team."
"We are excited to welcome these stores and their talented teams into the Mattress Warehouse family," said Bill Papettas, CEO of Mattress Warehouse. "With our proven track record of growth and operational excellence, we are confident in the successful integration of these new locations into our expanding portfolio. This acquisition not only strengthens our market position but also enhances opportunities for our team members, vendor partners, and, most importantly, our customers, helping them live better lives through quality sleep."
Upon the closing of the Mattress Firm transaction and this divestiture, Tempur Sealy expects to operate over 2,800 retail locations worldwide and anticipates that half of its North American sales will come from the Mattress Firm operations. The Company continues to expect to realize annual run-rate synergies of $100 million by the end of year four after closing the Mattress Firm transaction.