Tempur Sealy International said on Monday it plans to sell more than 100 stores in a bid to get regulatory approval for its $4 billion deal with Mattress Firm.
Tempur Sealy’s merger with Mattress Firm, which would create a combined empire of about 3,000 stores globally, raised concerns about price hikes and job losses and led the U.S. Federal Trade Commission to sue in July to block the merger.
The mattress manufacturer, which has been acquiring retailers to expand its presence in the segment, now plans to sell 73 Mattress Firm locations to independently owned bedding specialty retailer Mattress Warehouse.
The company will also sell 103 specialty mattress retail locations under its Sleep Outfitters brand, and seven distribution centers.
The divestiture is subject to the closing of its deal with Mattress Firm, Tempur Sealy said.
The Lexington, Kentucky-based company said it would continue to supply its products to the divested Mattress Firm and Sleep Outfitters stores.
The hearing of its litigation process with the U.S FTC is scheduled to begin on Nov. 12 and is expected to last for two weeks.
In a separate statement, Tempur Sealy said it has entered into a term loan agreement for $1.6 billion to help fund its cash-and-stock deal to add Mattress Firm’s more than 2,300 brick-and-mortar store locations to its lineup.
Source: Reuters.com