Sleep Country expects to have over 800 stores when the companies combine, suggesting its footprint will shift firmly south of the border, since it has about 307 Canadian stores and Sleep Number had 570 U.S. stores as of June. The $701 million deal was part of a court-supervised sale process after Sleep Number filed for Chapter 11 bankruptcy protection in June.  (The Logic)

Talking point: S&P Global analysts warned Sleep Number’s turnaround might be slow, and Sleep Country Canada, which is owned by Toronto-based Fairfax Financial, has issued notes and loans to raise money for the deal. “The mattress industry has experienced a multi-year secular downturn after the pandemic-related peak, with industry growth expected to remain in the low-single digits,” the analysts wrote in a debt-rating note. Sleep Number had originally expected to sell to Sleep Country Canada for about US$415 million before the competitive bidding process kicked off. Still, Sleep Country Canada said it will be the second-biggest “sleep retailer” in the world after the deal, with CEO Stewart Schaefer calling it “game-changing.”