Casper Sleep, a company known for manufacturing mattresses, went public in February 2020 with a successful IPO. Initially, its stock traded above the initial price, leading to a valuation of $575 million. However, facing tough competition from other mattress companies with similar direct-to-consumer models, Casper struggled to maintain its high valuation, causing its value to decline after going public. Fortunately, an equity firm is stepping in to take Casper private again.
Today, Casper announced a deal with Durational Capital Management, an equity firm, to purchase all outstanding shares and transition the company back to private ownership. Durational will pay $6.90 per share, which resulted in a market reaction that boosted Casper’s value.
Philip Krim, Casper’s co-founder and CEO, expressed optimism about the agreement, stating, “This deal presents a great opportunity to maximize value for our shareholders and provide Casper with the necessary capital to pursue future growth strategies.” Following the transaction, Krim will step down from his role, and Emilie Arel, Casper’s current president and chief commercial officer, will take over as the new CEO.
Market response to the buyout news was positive, with Casper Sleep shares experiencing a surge, trading 94% higher. The company had been exploring options to raise capital for some time before reaching the decision to sell to Durational Capital Management after careful consideration. The transaction is expected to be completed in Q1 of 2022.
