Sandy delays auction of Mattress Discounters
Larry Thomas -- Furniture Today, November 5, 2012
RICHMOND, Va. - Top 100 retailer Sleepy's Inc. and private equity firm Longroad Asset Management have emerged as the two qualified bidders for bedding retailer Mattress Discounters, but an auction scheduled for last week was postponed due to Hurricane Sandy.
The auction, and a U.S. Bankruptcy Court hearing here to approve the winning bid, were delayed because representatives of both bidders were unable to get flights to Richmond.
Sleepy's is based in Hicksville, N.Y., and Longroad is based on Stamford, Conn. - areas hit hard by the monster storm.
Mattress Discounters, an 80-store retail chain, is not in bankruptcy, but parent company RoomStore Inc. is in the midst of Chapter 7 liquidation proceedings. RoomStore owns 65% of the sleep shop chain and Mattress Discounters CEO Ray Bojanowski owns the remaining 35%.
An earlier agreement between Bojanowski and the trustee overseeing RoomStore's liquidation gives the trustee the right to sell all of Mattress Discounters' equity for at least $10 million.
The initial bids of Sleepy's and Longroad weren't disclosed in the court filings, but neither was designated as the "stalking horse" bidder.
Sleepy's has more than 800 stores and was ranked ninth on Furniture/Today's most recent Top 100 Furniture Stores listing. The retailer had sales of $846 million in 2011, according to Furniture/Today estimates
Longroad Asset Management invests primarily in U.S. and Canadian companies with annual revenues of $300 million to $400 million, according to the firm's website.