Mattress Company Serta Simmons Files for Bankruptcy
Serta Simmons Bedding, the Georgia-based mattress company, filed for Chapter 11 bankruptcy on Monday, saying the move is an attempt, in part, to reduce the company's debt. The company, owned by private equity firm Advent International, said it's "operating as normal" — it earmarked $125 million in financing to keep operating — and the restructuring will allow the business to continue making "critical investments" in its business and brands, in addition to paying down debt.
"With the support of key financial stakeholders, we are taking steps to strengthen our financial position," CEO Shelley Huff said. "After the conclusion of this process, we will have a stronger financial foundation to drive profitable growth and continue delivering the high-quality, innovative products that our company is known for.”
Total Retail's Take: As consumers begin to cut back in an uncertain economic environment of rising inflation and interest rates, they're most likely to cut spending on discretionary categories like mattresses and other home goods. That leaves retailers and brands in those categories, including Serta Simmons, in a compromised position. Serta, which accounts for nearly 20 of annual bedding sales in the U.S., is being proactive in trying to pay down debt and improve its financial standing as we move deeper into what figures to be a challenging year for mattress sellers.