UPDATE: More details on move to force 1800mattress.com into bankruptcy
Spokesman says move could delay sale
Larry Thomas -- Furniture Today, March 19, 2009
See an updated version of the story here.
NEW YORK — Two mattress producers and a landlord have filed a petition in U.S. Bankruptcy Court here asking that 1800mattress.com be forced into Chapter 7 bankruptcy.
The petitioners, who include Sealy and Comfort Solutions licensee Blue Bell Mattress, contend the retailer is not paying its bills. By filing the petition, they are trying to force the company to liquidate its assets and distribute the proceeds to creditors.
According to documents filed with the court, Sealy says it is owed $1.16 million and Blue Bell says it is owed $471,409. The third petitioner, 6225 Jericho Turnpike LLC, says it is owed $17,452 in rent.
Earlier this week, the retailer said it had signed a letter of intent to sell the company to an investor group led by mattress industry veteran Ken Mazda.
A spokesman for 1800mattress.com said the filing of the petition could delay the closing of that deal, and noted that other potential buyers have emerged since the petition was filed.
"A number of individuals and investor groups are interested in the long-term opportunities of investing in our brand, and we expect to continue to work with these groups to explore our options," the spokesman said.
He added that the bankruptcy petition would have no effect on day-to-day operations. "We have the right assortment and depth of inventory to satisfy our customers' needs. No one should see any disruption of service."
The retailer was founded in 1976 as Dial-A-Mattress and originally made nearly all of its mattress sales over the phone. Currently, the company has about 40 bricks-and-mortar stores in addition to its telephone and Internet sales operations.
The bankruptcy petition does not involve a 1800mattress.com franchise group that covers markets in New England, Philadelphia, central and southern New Jersey and Florida.
Bob Klein, president of the franchise group, said his company is independent of the franchisor and is unaffected by the petition.
"We are not involved in any way, and it is business as usual for our customers," Klein said. "There is no impact whatsoever on our ability to purchase product, make sales and deliver to our customers."
He said his company has separate contracts with Sealy, Serta, Simmons, Spring Air and Tempur-Pedic, and is current on all payments. His company has its own call center in suburban Boston and its own fleet of delivery trucks.
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1800mattress in flux
Mar 23, 2009
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