BOSTON – Advent International, the global private equity firm, today announced that it has agreed to acquire a majority interest in AOT Bedding Super Holdings, the parent company of National Bedding Company (the majority owner and licensee of Serta) and Simmons Bedding Company. Serta and Simmons are two of the largest and fastest growing mattress manufacturers in the world, offering a wide variety of innovative and popular mattresses across various price points.
Current investors Ares Management LLC and the Ontario Teachers’ Pension Plan (Teachers’) will retain a significant equity stake. The transaction is expected to be completed by the fourth quarter of 2012, subject to various closing conditions.
“We are looking forward to our partnership with Advent, as well as our continued relationship with Ares and Teachers’,” said Bob Sherman, CEO of Serta. “Advent’s experience and resources will help Serta continue our track record of growth and enhance our partnerships with customers and suppliers.”
“Over the past two years, we have invested significant resources to better understand and then meet the needs and preferences of our customers,” said Gary Fazio, CEO of Simmons Bedding. “We are thrilled to be working with the team at Advent, as well as our existing investors, to continue to gain market share by providing superior products and customer support.”
“We are excited to be investing in Serta and Simmons, two companies with strong momentum in an industry we believe is poised for growth,” said Jefferson Case, Principal at Advent International. “We look forward to working with our investment partners and the management teams of both companies.”
“Our strategy going forward is to continue to grow the businesses by ensuring that Serta and Simmons remain focused on delivering high quality mattresses that help people sleep better,” said Advent Managing Director Steven Collins.
“We are proud to have assembled the leading company in the bedding industry over the last seven years,” said Bennett Rosenthal, Senior Partner at Ares Management. “We have enjoyed our partnership with Bob and Gary, as well as the rest of the leadership team, who have led the growth of Serta and Simmons to the top position in the industry. We are equally enthusiastic about our partnership with Advent and our participation in the company’s continued growth.”
“This investment will represent a significant step in the implementation of Serta’s and Simmons’ strategies to deliver the best possible products in the marketplace,’ said Jane Rowe, Senior Vice-President, Teachers’ Private Capital. “With the Advent team’s experience and resources, and the hard work of the management team and committed employees, we see excellent opportunities to continue growing the business and look forward to remaining a part of this ongoing success story.”
Serta and Simmons will continue to be managed jointly by the board of directors of their holding company and will continue, as in previous years, to maintain separate sales, marketing, merchandising and customer-specific product design functions. Also, the two companies will typically go to the marketplace separately, although, in some cases, the two companies will work together with dealers as well as in a variety of other areas to achieve cost efficiencies and implement best practices.
Advent is one of the world’s most active investors in the retail and consumer sector, having invested in ten companies over the last five years and with 20 dedicated investment professionals globally. Relevant current and historical investments include Five Below, Party City, Lululemon Athletica, Hudson News and Bojangles’.
Weil Gotshal & Manges LLP acted as legal advisor to Advent International. Barclays acted as lead financial advisor and Deutsche Bank Securities Inc. and Morgan Stanley & Co. LLC acted as co-advisors to AOT Bedding Super Holdings. Sullivan & Cromwell LLP acted as legal advisor to AOT Bedding Super Holdings.
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