Cerberus to acquire Brooklyn Bedding and Helix Sleep

Cerberus Capital Management has agreed to acquire Brooklyn Bedding and Helix Sleep to form a DTC mattress platform. No financial terms were disclosed. Credit Suisse served as financial advisor to Cerberus on the deal while FocalPoint Partners did likewise for Brooklyn Bedding. And, Moelis & Company was financial advisor to Helix.

PRESS RELEASE

13 September 2021
Cerberus Capital Management, L.P. (together with its affiliates, “Cerberus”), Brooklyn Bedding LLC (“Brooklyn Bedding”), and Helix Sleep, Inc. (“Helix”) today announced the signing of definitive agreements pursuant to which an affiliate of Cerberus will acquire each of Brooklyn Bedding and Helix in a series of related transactions. Upon completion of the transactions, the businesses will operate under a holding company structure in partnership with their respective founders, as well as other existing shareholders, who will retain a significant minority ownership interest in the combined business on a going forward basis. The combined company will be a leading direct-to-consumer (“DTC”) mattress platform that will provide customers with a broad portfolio of high-quality offerings and superior end-to-end experiences.

Brooklyn Bedding crafts expertly-made bedding with its cutting-edge equipment and patented materials and distributes its products through an omni-channel platform. Helix designs and provides custom-made mattresses through a tailored digital experience and analytics-focused marketing strategy. Together, the combined company will offer customers Brooklyn Bedding’s and Helix’s leading products through a vertically integrated, scalable platform supported by best-in-class manufacturing and digital capabilities.

Brooklyn Bedding and Helix will continue to operate under their respective brand names and the combined company will be led by John Merwin, current Chief Executive Officer of Brooklyn Bedding. Helix’s co-founders Adam Tishman, Kristian von Rickenbach, and Jerry Lin will lead the DTC segment of the combined business.

“We have long admired Helix and are excited to be teaming up with them,” said John Merwin, Chief Executive Officer of Brooklyn Bedding. “Helix’s innovative business model has driven extraordinary growth, and its high-quality products have made it a trusted brand to customers. Supported by Cerberus’ operational and technology expertise, our combined platform will be able to capture significant growth opportunities and deliver even greater mattress-buying experiences for our customers.”

Adam Tishman, Kristian von Rickenbach and Jerry Lin, co-founders of Helix, commented: “Our vision has always been to sell exceptional home and sleep products to our customers, so that they can enjoy the moments that matter with the people they love. We know firsthand that Brooklyn Bedding shares a similar customer-first mission and is one of the finest manufacturers of mattresses in the country. The integration of our two organizations and Cerberus’ partnership will enable us to become a category leader that provides customers with innovative new products and first class service.”

Scott Wille, Senior Managing Director at Cerberus, added: “This is an exciting opportunity to combine two incredible businesses with highly complementary capabilities. Brooklyn Bedding and Helix will bring together their respective strengths to meet the growing demand in the DTC mattress market. Together, the company will deliver expertly crafted products made in the U.S.A. and world-class customer experiences. We look forward to working alongside this leadership team as they build on their shared mission and help even more customers on their mattress-shopping journey.”

The transactions are expected to close early in the fourth quarter of 2021, subject to the satisfaction of all regulatory and other customary closing conditions.

Credit Suisse served as exclusive financial advisor and Simpson Thacher & Bartlett LLP served as legal advisor to Cerberus. FocalPoint Partners served as financial advisor and SheppardMullin served as legal advisor to Brooklyn Bedding. Moelis & Company LLC served as exclusive financial advisor and Bass, Berry & Sims PLC served as legal advisor to Helix.

About Cerberus
Founded in 1992, Cerberus is a global leader in alternative investing with over $55 billion in assets across complementary credit, private equity, and real estate strategies. We invest across the capital structure where our integrated investment platforms and proprietary operating capabilities create an edge to improve performance and drive long-term value. Our tenured teams have experience working collaboratively across asset classes, sectors, and geographies to seek strong risk-adjusted returns for our investors. For more information about our people and platforms, visit us at www.cerberus.com.