Southerland completes sale to employees
ESOP offers advantages, company says
David Perry -- Furniture Today, May 18, 2010
NASHVILLE, Tenn. — Independent bedding producer Southerland said the purchase of the company by its employees was completed Monday.
Southerland officials said the sale to the employees through an Employee Stock Ownership Plan is an unusual move in the bedding and furniture industries.
The sale was announced in March. Company officials said they expected the deal to close that month, but it took longer than expected.
Southerland is now led by co-presidents David Corbin and Steve Russo and by Bryan Smith, executive vice president and chief financial officer, and a longtime Southerland employee. They plan to continue to develop their own brands and private-label brands for regional bedding retailers.
Southerland family members including Marty and Trey Southerland will remain with the company. Former Chairman and CEO Herman Southerland has retired.
"We're proud of the products we make and the company we've become," Herman Southerland said. "Southerland has operated as a family owned enterprise for more than a century. During that time, we've become one of the leading independent bedding manufacturers in the U.S. Today, looking back at what we created together, I'm especially proud to be a company employees want to own and carry forward."
Southerland is based in Nashville and operates plants there and in Oklahoma City and Phoenix. The facilities "offer scalability and capacity ideally suited for the company's plans for further growth and distribution," the company said.
Under the new ESOP, employees own 100% of Southerland. The ESOP structure offers tax efficiencies for the company as well as incentives and a strong retirement benefit for employees, officials said.
The new management team said it will focus on consumer-based product development initiatives, a diversified licensed brand portfolio, and optimization of the cost structure through lean practices, strategic sourcing and value-added sales efforts.
Corbin and Russo had been working as consultants with Southerland since the middle of last year. Corbin previously worked for Procter & Gamble, Pulaski Furniture and Chromcraft Revington, and Russo has extensive bedding experience at Latex International, Consolidated Bedding and Restonic.
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Sale of Southerland to employees completed
May 24, 2010
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