Beter Bed reaches financial agreements with banks and major shareholders

Beter Bed Holding announced on Friday that it had reached agreement with its banks and major shareholders to facilitate its exit of German mattress discounter Matratzen Concord.

The Dutch bedroom furniture group said its liquidity issue has been addressed, and waivers had been agreed with banks on covenant testing of the existing covenants.

New covenants would be in place as of 30 September.

Beter Bed said it also secured a loan of €7m from three major shareholders, adding that it anticipated the completion of its previously-announced “full or partial” exit of Matratzen Concord before the end of 2019.

It claimed several parties had already expressed “serious” interest.

With those actions, Beter Bed’s board said the firm would be able to further grow and accelerate the good sales performance it was seeing in its remaining markets.

Looking at its current trading, Beter Bed said that over the second quarter, sales were “almost stable” at €88.6m.

Like-for-like sales rose 2.4%, which the company put down to good sales increases at Beter Bed in the Benelux region, Sweden and in DBC Wholesale, which compensated for the decrease at Matratzen Concord.

“Over the past period, we have been in constructive dialogue with our banks, and I am pleased to announce that we have been able to reach an agreement,” said Beter Bed chief executive officer John Kruijssen.

“At the same time, we were able to secure additional financing from our major shareholders.

“This shows that we have key stakeholders that are confident on the strategic direction and that we are taking the right actions to get back on track to a financially healthy company with strong prospects.”

Kruijssen said the announced financial short-term platform, by means of temporarily waiving covenants and a secured loan, would enable the firm to proceed with the process to investigate the full or partial exit alternatives for Matratzen Concord.

“At the same time, our key focus will remain on accelerating our activities in the Benelux region, that showed a strong sales performance over the second quarter of this year, with increased focus on Sweden and on boosting the digital and wholesale channels, where the current growth rates are ahead of what was initially anticipated.

“Although the general market conditions will remain essential, we believe these activities and their current performance positions us well for a sustainable future.”