Equity firms buy Tempur World
By Furniture Today Staff -- Furniture Today, November 11, 2002
Lexington, Ky. — Private equity firms TA Associates and Friedman, Fleischer & Lowe have acquired fast-growing specialty bedding producer Tempur World for about $350 million.
Tempur World, based here, rakes in over $250 million in annual revenue as a leading manufacturer and distributor of visco-elastic foam mattresses, pillows and other proprietary consumer products, which it sells globally under the brand names Tempur and Tempur-Pedic.
The company has posted average annual increases in revenues and earnings of over 30% since 1999. Tempur-Pedic, the bedding brand marketed in the United States, has been a strong performer.
TA, with offices in Boston and Menlo Park, Calif., and San Francisco-based FFL, acquired Tempur World, founded in 1991, from a group that includes current management, which will remain in place and retain an ownership stake.
"Having grown Tempur World from a startup into a worldwide company, we saw this as an ideal time to benefit from the additional capital, connections and advice TA and FFL have to offer as we move into our next phase of growth," said Robert Trussell, Tempur's chief executive officer.
The purchase involved equity capital of about $95 million from TA and $50 million from FFL. In addition, TA provided $35 million of a $50 million subordinated debt issuance.
The visco-elastic foam that Tempur uses initially was developed by NASA scientists in the early 1970s for use in spacecraft seats to relieve astronauts of g-forces experienced during liftoff.
Today, Tempur sells in 51 countries through a variety of distribution channels, including furniture retail, specialty retail, direct response and health care. Products are manufactured in two state-of-the-art facilities, in Duffield, Va., and Aarup, Denmark.
Key Tempur-Pedic retailers in the United States include Avon, Mass.-based Jordan's Furniture, Michigan's Art Van chain and Atlanta-based Havertys. Specialty retailers selling the brand include Brookstone, Relax the Back and The Healthy Back.
"We are enthusiastic about the opportunity to acquire Tempur World and pleased to have FFL as our partner along with a strong management team led by CEO Robert Trussell," said P. Andrews McLane, senior managing director at TA, who is joining Tempur's board along with TA Vice President Jeffrey S. Barber.
Also joining the board are FFL Chairman and CEO Tully M. Friedman and FFL Managing Director Christopher Masto.
