Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Steinhoff to buy Mattress Firm for $3.8 billion including debt

Published 07/08/2016, 21:19
Updated 07/08/2016, 21:19
© Reuters.  Steinhoff to buy Mattress Firm for $3.8 billion including debt

© Reuters. Steinhoff to buy Mattress Firm for $3.8 billion including debt

By Mike Stone

NEW YORK (Reuters) - South African retailer Steinhoff International Holdings NV (DE:SNHG) will buy Mattress Firm Holding Corp (O:MFRM), the largest speciality bedding retailer in the United States, for $3.8 billion (£2.9 billion) which includes debt, both companies said on Sunday.

Steinhoff said it will pay $64 per share, a premium of about 115 percent to Mattress Firm's Friday close in a deal that will create the world's largest mattress retail distribution company. The boards of both firms have approved the deal, the companies said in a statement.

The deal is subject to completion of a successful tender offer for Mattress Firm's shares. The transaction is expected to close in the third quarter of 2016, the companies said.

Mattress Firm, founded in 1986, has approximately 3,500 stores across 48 states with 80 distribution centres.

Steinhoff is a German-listed $22 billion furniture conglomerate led by South African retail mogul Christo Wiese who is also Steinhoff's chairman and largest shareholder.

Steinhoff, which owns brands in Africa, Australia, the U.K. and across Europe, last month agreed to pay nearly $800 million for British-based discount chain Poundland (L:PLND) after two previous attempts to expand in Europe fell through this year.

The Mattress Firm Holding deal would give Steinhoff access to the growing U.S. market, and help diversify its operations and guard against possible repercussions following Britain's June vote to leave the European Union.

Markus Jooste, chief executive officer of Steinhoff, said the deal "will allow Steinhoff to not only enter the U.S. market with an industry leading partner and a national supply chain, but it will also expand Steinhoff's global market reach in the core product category of mattresses."

In February, Mattress Firm solidified its position as a leader in the U.S. mattress retail market when it completed its $780 million acquisition of HMK Mattress Holdings LLC, the holding company of Sleepy's. Sleepy's was the second largest speciality mattress retailer in the U.S. with over 1,050 stores in 17 states in the Northeast, New England, the Mid-Atlantic and Illinois.

Linklaters LLP acted as legal counsel to Steinhoff. Barclays PLC (L:BARC) was financial advisor to Mattress Firm with Ropes & Gray LLP acting as legal counsel.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.