Tempur Sealy to Divest More Than 100 Stores in Bid to Close Mattress Firm Deal

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 business of about 3,000 stores globally, raised concerns about price hikes and job losses and led the U.S. Federal Trade Commission (FTC) to sue in July to block the merger. Tempur Sealy 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.

Total Retail's Take: Much like the ongoing Kroger-Albertsons' court battle with the FTC, the government regulatory agency is warning of price hikes that would negatively impact consumers as well as potential job losses if this partnership between Tempur Sealy and Mattress Firm were to be approved. Tempur Sealy is taking the proactive step of reducing its physical footprint to help assuage the FTC's concern, much like Albertsons and Kroger have done — to no benefit as of yet. What remains to be seen is how long Tempur Sealy and Mattress Firm will be litigating this issue in court, which is a costly process. The sooner a deal can get done the better for the two companies; will the same be said for consumers? That's what the FTC intends to find out.