Matress Firm Explodes in Growth Mode

UPDATE: Mattress Firm Wakes Up Competitors with 4th Industry Buyout
Deal to Acquire American Mattress Stores Will Grow Portfolio to 511 Stores in 40 Markets
Mattress Firm, the Houston-based specialty-bedding retailer, continues to roll up competitors in its bid to become the largest mattress retailer in the country. The company has been engaged in a buying free-for-all and its latest acquisition seems the most brazen. Mattress Firm will acquire all of the leases of American Mattress, a young retail mattress company started by one of Mattress Firm's own founders, Paul Stork. Last August, Stork bought the Houston stores of the American Mattress chain with a pledge to rival Mattress Firm and poured $500,000 into revamping the stores. At that time, Stork was quoted as saying, "I wish I hadn't done such a good job building up The Mattress Firm....They have momentum going for them and that's tough to compete against." Apparently, Stork was right. The deal is currently in due diligence and terms were not disclosed. In march, CoStar reported that Mattress Firm had struck a deal to acquire Mattress Discounters of Upper Marlboro, MD, which grew its portfolio by more than 140 stores and opened the door to six new markets in MD, VA, MA, RI, NH and DC. That announcement followed closely on the heels of two previous acquisitions by the company: Phoenix, AZ-based Metropolitan Mattress and Las Vegas, NV-based Bedtime Mattress Co. The addition of American Mattress stores will bring Mattress Firm's portfolio to at least 511 stores in 40 markets across the U.S., when the deal closes. Mattress Firm traded hands earlier this year when Boston-based private equity firm J.W. Childs Associates acquired the retailer from Sun Capital Partners. The following timeline illustrates Mattress Firm's growth over the past five years: October 2002 - Boca Raton, FL’s Sun Capital acquires Mattress Firm from Bain Capital. At the time, the retailer had 175 company-owned and 125 franchised stores in 39 markets across the U.S. June 2006 - Mattress Firm acquires Metropolitan Mattress. The transaction involved 26 locations in the Phoenix area. Combined with Mattress Firm's 14 existing Phoenix locations, it brings the retailer’s U.S. store count to 340 locations in 32 markets across 19 states. All Metropolitan Mattress stores are remodeled with Mattress Firm signage, store format, and products. January 2007 - Mattress Firm is acquired by J.W. Childs Associates and becomes Mattress Holding Corp. The company has grown to 350 stores in 32 markets in 19 states. Mattress Firm’s CEO, Gary Fazio said of J.W.’s acquisition in a press release, "Their track record with other leading retail and consumer brands, coupled with our deep bench of talent throughout our organization, are the ingredients we need to accelerate our efforts to open new stores and new markets. This ownership structure gives us capital for growth and the ability to continue the momentum we've established over the past several years." February 2007 - Mattress Firm announces agreement to acquire Bedtime Mattress, Inc., which owns and operates 15 stores in the Las Vegas area under Bedtime Mattress and Mattress Direct brand names. The deal will bring Mattress Firm’s store count to nearly 370 stores in 33 markets across 20 states. March 2007 - Mattress Firm announces an agreement to acquire Mattress Discounters, which has more than 140 stores across the Northeast. May 2007 - Mattress Firm announces agreement to acquire leases of 13 American Mattress stores in the Houston area. Mattress Firm, ranked 25th in Furniture Today's Top 100 retailers, has not announced plans to close any acquired stores. Expect to see 30 to 40 new stores added each year; typical store sizes range 3,000 to 4,000 square feet, and match well with discount retail tenants. for more information see:

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