Somnigroup International (NYSE:SGI) reached an agreement to acquire Leggett & Platt (NYSE:LEG) in an all-stock transaction valued at approximately $2.5 billion, a move that unites the world's largest bedding brand owner with its primary component supplier.
The deal, announced Monday, creates a vertically integrated furnishing powerhouse with pro forma annual sales exceeding $11 billion.
Under the terms of the agreement, Leggett & Platt shareholders will receive 0.1455 shares of Somnigroup common stock for each share of LEG they own.
Upon the completion of the merger, Leggett & Platt investors will hold approximately 9% of the combined entity on a fully diluted basis.
The transaction is designed to consolidate the supply chain for Somnigroup, which operates a dominant portfolio of sleep brands, including Tempur-Pedic and Sealy.
Leggett & Platt, a century-old manufacturer based in Carthage, Missouri, provides the specialized steel coils, foam, and adjustable bases that underpin the global bedding market.
By bringing these manufacturing capabilities in-house, Somnigroup aims to insulate itself from global supply chain volatility and accelerate its research and development cycles.
On a 2025 pro forma basis, the merged company would have generated approximately $11.2 million in net sales, $1.7 billion in adjusted EBITDA, and $1.1 billion in operating cash flow.
Management has identified $50 million in annual run-rate synergies, citing opportunities in logistics optimization, procurement, and the elimination of redundant corporate overhead.
The deal has received unanimous approval from the boards of directors of both companies.
It remains subject to approval by Leggett & Platt shareholders and the satisfaction of customary regulatory conditions.
Both companies expect the transaction to close by year-end 2026.