FTC Moves to Block Tempur Sealy's $4 Billion Acquisition of Mattress Firm

FTC Moves to Block Tempur Sealy's $4 Billion Acquisition of Mattress Firm

The US Federal Trade Commission (FTC) is preparing to file a lawsuit to block Tempur Sealy International Inc.'s $4 billion acquisition of Mattress Firm. The deal, announced in May 2023, aims to integrate Mattress Firm's more than 2,300 brick-and-mortar store locations with Tempur Sealy's global operations, creating a combined entity with approximately 3,000 stores worldwide.

The FTC's primary concerns are that the merger could lead to higher prices and reduced competition in the mattress industry. There are also worries about the potential negative impact on US manufacturing jobs, as most mattresses sold in the US are produced domestically. In response to these concerns, Tempur Sealy has indicated a willingness to divest some stores and has secured agreements with six other mattress manufacturers to continue carrying their brands.

The merger agreement includes a $50 million break-up fee in case of regulatory issues and sets a limit on the number of stores that can be divested. A final decision on the FTC's lawsuit is expected soon, following a closed-door meeting scheduled for Monday.

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