Houston-based Mattress Firm Holding Corp. completed its $425 million purchase of Sacramento, California-based Sleep Train Inc. on Oct. 20. Sleep Train, which operates about 310 sleep shops in California, Oregon, Washington, Idaho, Nevada and Hawaii, reported net sales of about $471 million in 2013. The sale brings Mattress Firm into 40 states, with 2,000 storefronts and 70 distribution centers.
Mattress Firm also announced it entered into a new, senior secured-credit facility comprised of an asset-based revolver of $125 million and term-loan borrowing of $720. Mattress Firm’s previous credit facility and outstanding term-loan borrowing were terminated at the closing, while $49 million was drawn under the new asset-based revolver.
“We are ecstatic to reach this milestone in our company’s growth and couldn’t be happier about our future together,” said Steve Stagner, Mattress Firm president and chief executive officer. “With the Sleep Train business, we become the first border to border, coast to coast multi-brand mattress specialty retailer in the United States, with pro forma sales of approximately $2 billion a year. We believe that our combined expertise will allow us to generate significant benefits for our stakeholders in the future. We are highly focused on integrating the two businesses and providing as seamless a transition as possible for all of our employees, customers and other stakeholders.”
Dale Carlsen, Sleep Train founder and chief executive officer, holds the title of president and chief strategy officer, and was named to Mattress Firm’s board of directors as vice chairman.
Rob Killgore, Sleep Train chief operating officer, was named co-chief operating officer, serving alongside Mattress Firm’s Ken Murphy. Sleep Train is maintaining a West Coast headquarters.
“This transaction is the culmination of nearly 30 years of hard work by the Sleep Train family of employees, and the beginning of the next chapter in our phase of growth,” Carlsen said. “I look forward to bringing our two teams together for the benefit of our customers, our employees and the communities we serve.”
