DTC mattress brand Purple could sell itself. The brand confirmed it received an unsolicited bid on Saturday from Coliseum Capital Management to acquire the company.
The bid includes acquiring Purple’s remaining common stock for $4.35 a share, a nearly 56% premium to the brand’s closing price on Friday of $2.79.
Purple’s board “will carefully review the proposal to determine the course of action that it believes is in the best interest of Purple and all Purple shareholders,” the brand said in a press statement Monday.
Coliseum Capital Management — which owns 40.9 million shares, or 45% of the company’s common stock — said its proposal is conditioned on it being approved by a special committee of independent and disinterested board members, and is subject to the approval of a majority of the shares of common stock not owned by Coliseum Capital Management or other interested parties.
The proposed deal has the potential to take Purple private after entering the public markets in 2018 via special purpose acquisition company Global Partner Acquisition Corp. In a similar move, DTC mattress brand Casper earlier this year was taken private after being acquired by Durational Capital Management, a private equity firm.
Purple, which benefited in the early months of the pandemic as consumers bought more items for their homes, has seen its sales and stock price decline more recently.
In its most recent quarter, the DTC brand reported net sales fell 21.1% year over year to $144.1 million. Purple swung to a loss during the period, posting an $8.3 million net loss from a net income of $2.6 million last year.