Serta Simmons Bedding is seeking bankruptcy protection in an effort to trim its debt load following an earlier out-of-court restructuring, Bloomberg News reported. The Atlanta-based mattress maker filed in the Southern District of Texas on Monday. The chapter 11 filing allows Serta to continue operating while implementing a deal, backed by a majority of lenders and shareholders, to cut its debt to $300 million from $1.9 billion, the company said in a statement. The firm also obtained a $125 million debtor-in-possession ABL credit facility, it said. Facing financial distress amid the pandemic, Serta agreed on a previous restructuring with creditors in 2020 that added $200 million of fresh capital while allowing some lenders to jump to the front of the repayment line. Other lenders were pushed back, a process known as priming. A group of funds including Angelo Gordon & Co. and Apollo Global Management sued Serta and rival lenders in the hopes of invalidating the transaction. The company’s debt, which stems from a roughly $3 billion leveraged buyout by Advent International in 2012, has hobbled the retailer. Confidential talks over a restructuring plan started late last year, Bloomberg earlier reported.
