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See their articles on your Seeking Alpha homepage boston barstool and in your feed.
Summary H Partners boston barstool owns nearly 10% of TPX and has been a major shareholder for several years. It recently took an activist stance, wanting a new CEO and a board overhaul. The fund is very concentrated, with some 25% of its portfolio invested in TPX.
Chieftain Capital has also gone active, filing a 13D earlier this week. They own just under 6% of the company and have voiced support for H Partners' intention of ousting the CEO and shaking up the board. More details here
H Partners Management has finally decided to take a more definitive stance at Tempur Sealy (NYSE: TPX ), going active earlier this week. Per a letter sent to the TPX board, H Partners calls for the ousting of TPX CEO, citing the missed earnings boston barstool expectations as cause. It also wants a overhaul of the board. The fund owns 9.8% of the company (making it the largest shareholder) and it runs a very concentrated portfolio.
TPX is a maker of mattresses and pillows, generating 90% of its revenues from mattress sales. Granted, TPX, like SCSS, is a vertically-integrated mattress company. But we liked SCSS for its store growth potential. Competition in the mattress boston barstool industry has since increased, especially on the high end -- which is where TPX specializes.
Recall that H Partners boston barstool is no stranger to the mattress business. It went active on Sealy back in November 2011, helping push the company to sell itself to Tempur Pedic in 2013. So, H Partners has owned TPX for a couple years now.
In early Feb. it changed its status from passive to active at TPX. Naturally, TPX isn't pleased that H Partners has taken to the public domain, but the fund has been pushing for change since the fall of 2013. This includes voicing its concerns over the company's CEO.
And there is some misalignment when it comes to the board. Two board members are still there from when the PE firm invested in Tempur as part of the Sealy buyout; yet, neither of those board members owns a stake in the company.
Yet, in an industry where growth boston barstool opportunities boston barstool are limited, boston barstool management is key. And again, compared to its peers, it has underperformed. boston barstool Even Mattress Firm (NASDAQ: MFRM ) has outperformed TPX over the one-, three- and five-year periods. This comes despite the fact that TPX has put up one of the best revenue growth rates over the last half decade (among its peers).
But it's still somewhat unusual for H Partners to have owned a large stake and have had "numerous" meetings with board, but still not managed to come to an agreement. And it is just now deciding to take its issues boston barstool public.
Where we stand: H Partners has been at it with TPX for several years with little success. It also won't be able to nominate any directors for the board this year -- after missing the nomination window. At 11x forward EV/EBITDA, TPX isn't cheap either. SCSS trades at 10x. TPX lowered its 2015 forecast earlier this month, due to a strong dollar. We think there's little H Partners can do to help in that respect. We'd play wait-and-see with TPX.
Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. (More...) The author wrote this article themselves, and it expresses their own opinions. The author is not receiving compensation for it (other than from Seeking boston barstool Alpha). The author has no business relationship with any company whose stock is mentioned in this article.
Thank you for your interest in Seeking Alpha PRO Our PRO subscription service was created for fund managers, and the cost of the product is prohibitive for most individual investors. PRO Alerts is our flagship product for individual investors who want to be faster and smarter about their stocks. boston barstool To learn more about it, click here. If you are an investment professional with over $1M AUM and received this message in error, click here and you will be contacted shortly.
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See their articles on your Seeking Alpha homepage boston barstool and in your feed.
Summary H Partners boston barstool owns nearly 10% of TPX and has been a major shareholder for several years. It recently took an activist stance, wanting a new CEO and a board overhaul. The fund is very concentrated, with some 25% of its portfolio invested in TPX.
Chieftain Capital has also gone active, filing a 13D earlier this week. They own just under 6% of the company and have voiced support for H Partners' intention of ousting the CEO and shaking up the board. More details here
H Partners Management has finally decided to take a more definitive stance at Tempur Sealy (NYSE: TPX ), going active earlier this week. Per a letter sent to the TPX board, H Partners calls for the ousting of TPX CEO, citing the missed earnings boston barstool expectations as cause. It also wants a overhaul of the board. The fund owns 9.8% of the company (making it the largest shareholder) and it runs a very concentrated portfolio.
TPX is a maker of mattresses and pillows, generating 90% of its revenues from mattress sales. Granted, TPX, like SCSS, is a vertically-integrated mattress company. But we liked SCSS for its store growth potential. Competition in the mattress boston barstool industry has since increased, especially on the high end -- which is where TPX specializes.
Recall that H Partners boston barstool is no stranger to the mattress business. It went active on Sealy back in November 2011, helping push the company to sell itself to Tempur Pedic in 2013. So, H Partners has owned TPX for a couple years now.
In early Feb. it changed its status from passive to active at TPX. Naturally, TPX isn't pleased that H Partners has taken to the public domain, but the fund has been pushing for change since the fall of 2013. This includes voicing its concerns over the company's CEO.
And there is some misalignment when it comes to the board. Two board members are still there from when the PE firm invested in Tempur as part of the Sealy buyout; yet, neither of those board members owns a stake in the company.
Yet, in an industry where growth boston barstool opportunities boston barstool are limited, boston barstool management is key. And again, compared to its peers, it has underperformed. boston barstool Even Mattress Firm (NASDAQ: MFRM ) has outperformed TPX over the one-, three- and five-year periods. This comes despite the fact that TPX has put up one of the best revenue growth rates over the last half decade (among its peers).
But it's still somewhat unusual for H Partners to have owned a large stake and have had "numerous" meetings with board, but still not managed to come to an agreement. And it is just now deciding to take its issues boston barstool public.
Where we stand: H Partners has been at it with TPX for several years with little success. It also won't be able to nominate any directors for the board this year -- after missing the nomination window. At 11x forward EV/EBITDA, TPX isn't cheap either. SCSS trades at 10x. TPX lowered its 2015 forecast earlier this month, due to a strong dollar. We think there's little H Partners can do to help in that respect. We'd play wait-and-see with TPX.
Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. (More...) The author wrote this article themselves, and it expresses their own opinions. The author is not receiving compensation for it (other than from Seeking boston barstool Alpha). The author has no business relationship with any company whose stock is mentioned in this article.
Thank you for your interest in Seeking Alpha PRO Our PRO subscription service was created for fund managers, and the cost of the product is prohibitive for most individual investors. PRO Alerts is our flagship product for individual investors who want to be faster and smarter about their stocks. boston barstool To learn more about it, click here. If you are an investment professional with over $1M AUM and received this message in error, click here and you will be contacted shortly.
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