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Dealipedia - Sleepy's acquires 1800mattress.com

Sleepy's acquires 1800mattress.com

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Acquiring Company: Sleepy's View Profile Add Homepage Google Search
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Target Company: 1800mattress.com View Profile Charts Homepage
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Announced: Mar 24, 2009

PRESS RELEASE

Two venerable giants in the mattress industry announced today that they have entered into a transaction to combine their businesses in order to deliver greater quality, service and value to consumers.

Bethpage, NY-based Sleepy's, the largest mattress retailer in the country, will acquire certain assets of 1800mattress.com and invest in the growth of the brand as the nation's leading premiere telephone, internet and chat retailer of bedding and sleep products. The companies plan to complete the sale through Chapter 11 of the U.S. Bankruptcy Code that will include a bidding process and ultimately a court ordered sale. 1800mattress.com is first electing to convert a pending involuntary Chapter 7 bankruptcy petition.

Sleepy's will provide debtor in possession financing that, together with the company's existing cash flow, will enable 1800mattress.com to fulfill obligations associated with operating its business, including payments to suppliers and other business partners for goods delivered and services provided after the start of the Chapter 11 process. This financing is subject to bankruptcy court approval.

1800mattress.com terminated discussions with other interested parties earlier last week.

"For the past several months we have been exploring strategic options that would make our business and brand stronger. There have been a number of individuals and investor groups interested in the long-term opportunities of investing in our brand, and we have determined that Sleepy's offered us the best opportunity to recapitalize and move our business plan forward," said 1800mattress.com Chairman and CEO Napoleon Barragan.

"There are tremendous business synergies we can leverage by affiliating with Sleepy's. This combination offers us the opportunity to realign our capital structure and to pursue our historic strengths in phone and internet sales," Barragan added. "Our call center, internet, chat and retail stores remain open and it is business as usual for our company. We have the right assortment and depth of inventory to satisfy our customers' needs and no one should see any disruption of service during this process."

The company's franchisees in New England, Connecticut, Philadelphia, Central and Southern New Jersey, and Florida, are separate companies which are not included in the bankruptcy filing.

"1800mattress.com is a valuable brand poised for future growth," said Sleepy's COO Adam Blank. "We look forward to working with 1800mattress.com vendors and employees to assure that customers receive the same quality service and merchandise that have made 1800mattress.com so successful."

About 1800mattress.com

Founded in 1976, 1800mattress.com is the leading national multi-channel (internet, chat, call center and showrooms) retailer of mattresses, box springs and bedding products. It features products by all major brands, including custom sizes, sofa beds, Murphy beds, futons, and adjustable and organic beds. Its award winning customer service is well chronicled in thousands of media articles and books. The company was also the first mattress retailer to introduce a two-hour delivery window, and fast national and international delivery of its products. Its business-to-business sales division supplies schools, hospitals, hotels and other institutions. For more information, please visit www.1800mattress.com.

For more information about the Chapter 11 process, please visit www.kccllc.net/mattress.

About Sleepy's

Sleepy's, The Mattress Professionals, is a privately-owned company with nearly 700 locations in eleven states, spanning from Vermont to Virginia. Keeping up-to-date on all the latest innovations in sleep technology, Sleepy's carries a broad selection of major mattress brands to fit any price range or comfort level. For over 50 years, Sleepy's has touted the importance of a comfortable mattress, and achieving better health through a better night's sleep.

Contact: Stan Steinreich
Steinreich Communications LLC
(201) 498-1600

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Mar 25 '09
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