Casper Sleep entered into a definitive agreement to be acquired by Durational Capital Management. KKR Credit and Callodine Commercial committed debt financing to Durational Capital Management to support the acquisition.
Under the terms of the agreement, Casper common stockholders will receive cash consideration of $6.90 per share, representing a 94% premium to the closing share price on Nov. 12, the last trading day prior to this announcement, and a premium of approximately 80% to the 30-day volume weighted average price ending Nov. 12.
Casper’s board of directors unanimously approved the transaction and recommends that Casper stockholders approve the transaction and adopt the merger agreement. The transaction is expected to close in Q1/22 and is subject to customary closing conditions, including Casper stockholder approval. Officers and directors of Casper and affiliated investors, who in the aggregate own or control approximately 28% of the company’s outstanding shares, agreed to vote in favor of the transaction. Upon closing the transaction, Casper will operate as a privately-held company and will remain based in New York.
The transaction is not subject to a financing condition. Jefferies is serving as financial advisor and Latham & Watkins is serving as legal advisor to Casper Sleep in connection with the proposed transaction. Kirkland & Ellis is serving as legal advisor to Durational Capital Management in connection with the proposed transaction.
“We are delighted to announce this transaction with Durational Capital Management that creates immediate and substantial value for shareholders and allows Casper to move forward on strong financial footing,” Philip Krim, co-founder and CEO of Casper, said. “In consultation with outside advisors, Casper’s board of directors evaluated a range of strategic and financial alternatives over several months and determined, after careful consideration, that the transaction proposed by Durational is superior to all other alternatives available. With a commitment to maximizing value for all shareholders, the board unanimously supports the offer from Durational and recommends that shareholders approve the transaction. This agreement offers a promising opportunity to realize the highest value for our stockholders while providing Casper with much needed capital to execute on future initiatives to sustain and grow its business.”
“We are excited to invest in Casper given its iconic brand, strong growth profile and track record of innovation,” Eric Sobotka, managing partner at Durational Capital Management, said.
“With its world-class products and focus on health and wellness, we believe Casper is well-positioned for future success,” Matthew Bradshaw, managing partner at Durational Capital Management, said. “We look forward to partnering with the Casper team to build on the strength of the brand and to create new opportunities for the company to thrive.”