Tempur Sealy Wins Case to Acquire Mattress Firm, Deemed Pro-Competitive

A U.S. judge has ruled in favor of Tempur Sealy International's acquisition of Mattress Firm, a significant decision in a Federal Trade Commission (FTC) case aimed at blocking the deal. The opinion from Judge Charles Eskridge underscores that the merger is likely to elevate competition, opposing the FTC's claim that it would hinder competitive practices. The FTC's request for a preliminary injunction was denied, permitting the deal to proceed despite the agency's ongoing administrative hearings. Although the FTC argued that the deal created an unfair market advantage by integrating manufacturing and retail operations, the judge determined the mattress sector remained highly competitive. Additionally, the FTC's focus on premium mattresses priced above $2,000 lacked substantive backing, with the judge noting vertical mergers often demonstrate neutral or pro-competitive effects. Testimonies from industry executives supported claims that the merger would benefit consumers by saving $896 million annually. Serta Simmons, Tempur Sealy's primary competitor, was criticized for presenting exaggerated testimony. Despite the acquisition not anticipated to harm competition, Tempur Sealy planned to divest certain stores as a precaution. This decision marks a key procedural outcome for this major vertical acquisition, poised to shape the competitive dynamics in the sleep retail industry.