Mattress Firm — Merger or Acquisition (November 2015)
13 slides from Mattress Firm's merger presentation, Nov 30, 2015
Slide 1: Forward Looking Statements and Non-GAAP Information
Forward Looking Statements and Non-GAAP Information This presentation contains forward-looking statements within the meaning of federal securities laws, that are subject to risks and uncertainties. All statements other than statements of historical fact included in this presentation are forward-look
Slide 2: Strategic Rationale
Strategic Rationale 2 Acquires Attractive Store Base and Team in Key Markets Creates First Truly National Mattress Specialty Retailer Opportunity to Leverage National Scale Benefits Generates Significant Synergy Opportunities Earnings Accretion and Cash Flow Generation Creates the nation’s first bor
Slide 3: Transaction Overview
Transaction Overview 3 Key Items Description Purchase Price Total consideration of approximately $780 million Approximately $740 million of cash and debt Approximately $30 million of quantified liabilities assumed Up to $10 million of rollover equity (1) Expected to create an asset step-up, with an
Slide 4: Mattress Firm: The #1 Mattress Specialty Retailer
Mattress Firm: The #1 Mattress Specialty Retailer Includes 125 franchise locations; as of November 3, 2015 Per internal study as of Q2 2015. Excludes markets open less than one year and franchise locations #1 Over 90% of stores in markets where we have #1 market share(2) Largest Footprint Best-in-Cl
Slide 5: Sleepy's Overview: #1 Northeast Retailer
Sleepy’s Overview: #1 Northeast Retailer Banners 5 #1 Northeast Retailer Market Share Store Unit Growth Sales Growth #1 Leading market share in the majority of Sleepy’s core markets (1) Per internal Sleepy’s study completed in August 2014 Note: Q3 data as of Sleepy’s third quarter ended September 30
Slide 6: Current Pro Forma Top Mattress Specialty Retailers
Current Pro Forma Top Mattress Specialty Retailers (1) Sleepy’s acquisition further strengthens Mattress Firm’s position as the #1 Mattress Specialty Retailer in the fragmented retail bedding environment Market Leading Position 6 ($ in millions) ($ in millions) Source: Furniture Today Top 100, May 2
Slide 7: Border-to-Border, Coast-to-Coast Footprint
Border-to-Border, Coast-to-Coast Footprint 7 Note: Includes 125 Mattress Firm franchise locations, as of November 3, 2015. Sleepy’s store count as of September 30, 2015 WA OR CA NV ND UT AZ NM CO TX SD NE KS MO IL WI OK AR LA MS AL FL SC TN NC IA MN MI IN OH KY WV PA NY ME NH ID MT NJ CT MA 10 HI GA
Slide 8: Pro Forma Company – Q3 LTM Metrics
Note: Store count includes 125 Mattress Firm franchise locations, as of November 3, 2015. Mattress Firm latest twelve months ended November 3, 2015. Sleepy’s latest twelve months ended September 30, 2015 8 + = Pro Forma Company – Q3 LTM Metrics ($ in millions) Stores LTM Sales 2,420 1,066 3,486 0 1,
Slide 9: Significant Synergy Potential
Significant Synergy Potential 9 Estimated Potential Synergies from Sleepy’s Acquisition Cost Revenue Distribution and Logistics Advertising Sourcing and Procurement Operating Expenses Professional Services Other Approximately $40 million of estimated synergies by Year Three Exclusive Products Strate
Slide 10: Acquisition history and store locations
Austin, Dallas, Houston, San Antonio, Las Vegas 36 stores 2007 14 stores Las Vegas 2007 11 stores St. Louis 2007 Yotes Franchise 40 stores Atlanta, Miami, SW Florida, Tampa 2012 27 stores Charleston, Charlotte, Columbia, Greensboro, Greenville, Raleigh 2012 236 stores Atlanta, Minneapolis, St. Louis
Slide 11: Previous Acquisitions Progressing as Expected
11 Previous Acquisitions Progressing as Expected Chicago Market Continuing to Improve Strong Sleep Train Performance Chicago market continued to improve in Q3 with approximately breakeven profitability at the market EBITDA level Sleep Train business continued to perform extremely well with Q3 implie
Slide 12: MFRM: Key Investment Highlights
MFRM: Key Investment Highlights Proven Track Record of Driving Profitability Compelling Industry Dynamics Best-in-Class Specialty retailer Highly Achievable Growth Plan Experienced and Invested Management Team Long-term stability and consistent growth Highly fragmented industry Specialty Retailers c
Slide 13: MFRM: Key Investment Highlights
MFRM: Key Investment Highlights FL) = vvvV.Y Long-term stability and consistent growth Highly fragmented industry Specialty retailers continue to take share Pent-up demand with ~80% replacement Largest and only national footprint with significant scale Over 90% of stores in markets where Company is
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