Tempur Sealy to divest more than 100 stores in bid to close $4 billion Mattress Firm deal By Reuters

(Reuters) – Tempur-Sealy International Inc said on Monday it plans to sell more than 100 stores in a bid to win regulatory approval for its $4 billion deal with Mattress Firm Inc.

Tempur-Sealy’s merger with Mattress Firm, which would create a combined empire of about 3,000 stores worldwide, has raised concerns about higher prices and job losses, prompting the US Federal Trade Commission to file a lawsuit in July to block the merger.

The mattress maker, which has been acquiring retailers to expand its presence in the sector, now plans to sell 73 Mattress Firm locations to independently owned bedding specialist Mattress Warehouse.

The company will also sell 103 specialty mattress retail locations under its Sleep Outfitters brand, and seven distribution centers.

Tempur Sealy said the sale is contingent on the completion of the deal with Mattress Firm.

The Lexington, Kentucky-based company said it will continue to supply its products to the Mattress Firm and Sleep Outfitters stores that were divested.

The hearing in the litigation process before the US Federal Trade Commission is scheduled to begin on November 12 and is expected to last for two weeks.

In a separate statement, Tempur-Sealy said it has entered into a $1.6 billion term loan agreement to help finance the cash-and-stock deal to add more than 2,300 Mattress Firm brick-and-mortar stores to its portfolio.