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Two private equity groups to acquire Serta

David Perry -- Furniture Today, August 2, 2005

LOS ANGELES -- Two private equity groups are joining forces to acquire National Bedding Co., the bedding major that controls the Serta brand.

Ares Corporate Opportunities Fund, the equity fund of Ares Management, and Teachers’ Private Capital, the private equity arm of the Ontario (Canada) Teachers’ Pension Plan, said today they have signed a definitive agreement to buy NBC, which now does business as Serta International.

Terms of the transaction were not disclosed.

“We are thrilled to partner with Ontario Teachers’ in this transaction,” said Bennett Rosenthal, a partner in Ares Management. “We are also pleased that the existing equity owners of NBC will be reinvesting a portion of their proceeds along with us, and that the senior management team will remain in place.”

Added Jim Leech, Ontario Teachers’ senior vice president: “We are very pleased to be acquiring a company with such a strong and experienced management team and an extraordinary consumer brand. NBC is an excellent fit for our growing private equity portfolio.”

“We are looking forward to our partnership with Ares and Ontario Teachers,” said Bob Sherman, CEO of NBC. “Their strong, committed financial sponsorship will allow Serta to continue its track record of growth and partnership with our customers and suppliers.”

Burt Kaplan and Richard Yulman, NBC’s founders, will remain investors in the company and members of its board of directors.

Ares has had a minority stake in NBC for two years, Rosenthal said, and has been “impressed with the outstanding performance of the company’s management team. We look forward to the opportunity to increase our ownership stake as well as to continue to support the company’s growth in the $5 billion bedding industry.”

Ares Management is a Los Angeles-based investment firm with more $7 billion of committed capital under management. Founded in 1997, it specializes in originating and managing assets in both the private equity and leveraged finance markets.

Teachers’ Private Capital is the private equity arm of the $C85 billion Ontario Teachers’ Pension Plan, which invests on behalf of 255,000 active and retired teachers in Ontario.

Goldman, Sachs & Co. and William Blair & Co. represented NBC in the transaction.

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Serta group acquired

Aug 21, 2005

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