Mattress Firm filed for bankruptcy and is already beginning to close stores
08 October, 2018, 05:14
A release stated that the company will undertake a prepackaged bankruptcy that generally consists of the company reaching a deal with major creditors prior to the filing.
Mattress Firm announcing its Chapter 11 bankruptcy, and the closing of 700 stores in certain markets where it has too many locations near each other, including the one on Grand River Avenue in Okemos.
Mattress Firm is looking to close up to 700 of its 3,000 brick-and-mortar locations. The company now has more than 3,300 locations in the United States, including four in Sioux Falls.
According to court documents, the nation's largest mattress retailer has more than $1 billion in liabilities and has more than 50,000 creditors. However, Mattress Firm does not have a shop there.
At the end of 2017, its parent company, Steinhoff Holdings, which is now being investigated on charges of fraud, said it would be closing 200 Mattress Firm stores.
Krim estimated that about 10 to 12 percent of mattress sales are online.
In Southwest Virginia, Mattress Firm operates seven locations. "The Company intends that warranties, guarantees and other customer programs will be honored as usual", it said.
Mattress Firm is the most recent in a series of bankruptcies by national retailers as consumers chose to purchase goods online.
The retailer has also received $650 million to fund ongoing operations and repay debt and costs associated with the restructuring.
The Houston-based retailer was acquired by South African retailer Steinhoff International Holdings for $3.8 billion in 2016.
Stores could help Casper stand out in a crowded mattress market. In a court filing, the company also acknowledged "several well-intentioned, but ill-advised, marketing and sales promotions" in 2017 and 2018.