HOUSTON — Mattress Firm Holding Corp. (NASDAQ: MFRM) has entered into an agreement to acquire substantially all of the mattress specialty retail assets and operations of Mattress Liquidators Inc., a private company that operates Mattress King retail stores in Colorado and BedMart retail stores in Arizona.
The Houston-based mattress retailer will add approximately 75 specialty retail stores in markets where it currently operates — primarily Denver, Phoenix and Tucson, Ariz. The aggregate purchase price is approximately $35 million.
The closing of the acquisition is expected to occur by the end of the second fiscal quarter of 2014 and will be funded by cash reserves and revolver borrowings, as well as a $3.5 million seller note that is payable in quarterly installments over two years.
“We are excited to further expand our position in the Denver, Phoenix and Tucson markets,” says Steve Stagner, president and CEO of Mattress Firm. “We believe that the acquisition of the Denver stores will allow us to leap into a strong position in that market, building on the foothold established by the acquisition last month of the formerly franchised Mattress Firmstores in Denver. The additional stores in Phoenix and Tucson will supplement the existing base of quality stores that we currently operate in those markets.”
Earlier this month, Mattress Firm purchased Sleep Experts, a chain of 55 mattress stores in Dallas and Austin, for $65 million.
Mattress Firm currently operates more than 1,400 stores in 33 states. The company’s stock price closed Friday at $44.94 per share, up from $37.84 per share at this time last year.
— John Nelson