A MAJOR bedding company has filed for bankruptcy after racking up debts of $1.9billion.
Serta Simmons has existed since the 1870s and is one of the leading mattress manufacturers in the country.
The firm is behind brands such as Simmons, Beautyrest, Tuft & Needle, and Serta and accounts for around a fifth of all bedding sales across the country.
The company filed for Chapter 11 protection on Monday and wants to cut its debt from $1.9 billion to $300million, Reuters reported.
More than $100million has been reserved so the company can continue operating.
Chief Financial Officer John Linker revealed that new capital worth $200million helped the company during the Covid pandemic amid supply chain disruption.
But, he revealed that the retailer’s capital structure is now unsustainable three years on.
The bankruptcy filing comes just days after the company announced that it will be updating its Serta and Beautyrest product ranges, Business Wire reported.
Serta Simmons Bedding CEO Shelly Huff said: “At SSB, we have a rich history in innovation.
“This includes serving sleepers with high-value products offering industry-leading performance across a wide range of price tiers.
“The collections we are launching this year across Serta and Beautyrest further build on this heritage, delivering a strong value proposition as well as feature sets that sleepers have been asking for, such as the integration of more sustainable materials.”
Designers have said that Serta’s new iComfortECO mattress is due to launch in April 2023 and is made from more sustainable materials.
While, its new Perfect Sleep mattress will range from $599 to $1,299, meaning it is more accessible to customers.
Serta Simmons is not the only company that has filed for bankruptcy protection.
The retailer experienced “liquidity and operational issues” that were caused by the Covid pandemic and changes to beauty habits, according to the outlet.
It came after the retailer dramatically announced that it would close the last of its 18 stores in the country.
Morphe tweeted on January 5: “We have made the difficult decision to close all Morphe stores in the U.S.
“We are forever grateful to our store teams for their passion, talent, and dedication over the years.”
Morphe plans to also end its partnership with the music star Ariana Grande, according to Bloomberg.
The singer-songwriter, 29, launched her r.e.m. beauty range in 2021.
The U.S. Sun reported how Party City has also filed for bankruptcy.
The WSJ claimed that Bed, Bath and Beyond could also file for bankruptcy protection.
But, a spokesperson for the chain said: “No determinations have been made at this time.”
Chiefs revealed in September last year that they planned to close 150 stores across the country.
More than 50 closures had already been announced, but another 62 stores were confirmed earlier this month, according to an official list posted by the company.
Axios reported that 30 states across America would see at least one Bed Bath & Beyond store close.
Meanwhile, Macy’s CEO Jeff Gennette told the National Retail Federation’s Big Show event that the major company is in the “final stretch” of its store closures.
Chiefs announced in 2020 that 125 stores across the country would shut their doors over three years.
At least four Macy’s stores are set to close this year, according to Axios.
Its outlet at the Baldwin Hills Crenshaw Plaza shopping mall is set to close at the end of this month, according to KABC.