Advent International said on Sunday that it has agreed to buy a majority stake in the parent company of Serta and Simmons bedding, taking control of one of the country's biggest makers of mattresses.
The deal for AOT Bedding Super Holdings is valued at about $3 billion, according to a person briefed on the matter. Ares Management and the Ontario Teachers' Pension Plan, which previously controlled AOT Bedding, will maintain sizable minority stakes in the company.
Advent outbid at least two other private equity firms, Bain Capital and Berkshire Partners, for AOT Bedding, another person briefed on the sales process said.
“We are excited to be investing in Serta and Simmons, two companies with strong momentum in an industry we believe is poised for growth,†Jefferson Case, a principal at Advent International, said in a statement. “We look forward to working with our investment partners and the management teams of both companies.â€
Through Sunday' s deal, Advent will control two mattress makers with a collective history of about 223 years. Based in Hoffman Estates, Ill., National Bedding is the biggest holder of Serta licenses in the country.
Simmons, which was founded in 1870, has passed through a series of investors before filing for bankruptcy in 2009, burdened by the cumulative weight of its multiple takeovers.
Ares and Ontario Teachers gained control of National Bedding in 2005. The two later gained control of Simmons in 2010, buying the company out of bankruptcy. Since then, the two mattress brands have been run as separate subsidiaries and continued to compete against each other.
Founded in Boston 28 years ago, Advent has become a particularly notable investor in consumer companies in recent years. Among its investments are Party City and the athletic clothing maker Lululemon Athletica.
Advent was counseled by the law firm Weil Gotshal & Manges. AOT Bedding was advised by Barclays, Deuts che Bank, Morgan Stanley and the law firm Sullivan & Cromwell.
