Tempur Sealy Sees Big Gains After Wall Street Learns About Mattress Firm Planning Bankruptcy

Mattress Firm, the largest mattress retailer in the United States, is planning to file for bankruptcy.

Rival Tempur Sealy saw its shares explode in pre-market trading on Wednesday after Reuters reported the news.

It was last year that Tempur Sealy stopped doing business with Mattress Firm, announcing in January of 2017 that it terminated the company’s contracts.

Mattress Firm, which has 3,000 brick-and-mortar locations, has been struggling in recent years against online retailers. The company’s parent company Steinhoff International Holdings NV also has debt.

Unidentified sources have told Reuters that once the company declares bankruptcy, the process would be complete in just a couple of months and the company’s vendors are expected to be paid in full.

The bankruptcy move would help the company’s financial situation, Reuters said.

Disclaimer: We have no position in Tempur Sealy International Inc. (NYSE: TPX) and have not been compensated for this article.