Steinhoff International Holdings NV is assessing ways to attract extra funding for Mattress Firm to execute a turnaround of the troubled U.S. bedding retailer, Bloomberg News reported. Bought for $3.8 billion two years ago, Mattress Firm has emerged as a headache for Steinhoff as it strives to shore up liquidity following an accounting scandal. The 3,300-store chain expanded too aggressively, suffered from ineffective marketing and has been embroiled in a dispute with suppliers, Steinhoff said in a presentation to creditors in London yesterday. Steinhoff bought Mattress Firm toward the end of an acquisition spree that preceded the uncovering of accounting irregularities in December, which wiped almost 95 percent off the share price. The South African company secured an agreement with lenders over the restructuring of almost 10 billion euros ($11.7 billion) of debt in July, buying it time to stabilize an empire that also includes Conforama in France and Pepkor Europe. Mattress Firm needs “incremental liquidity” for its recovery to be secured, and management, led by Chief Executive Officer Steve Stagner, is considering ways to access capital, Steinhoff said.
