BRITAIN'S biggest bedmaker Silentnight is going private in a 155p per share recommended deal that values the company at £72.2m.
The Clarke family, which founded the business in 1946 and which holds 50.9 per cent of the shares, made its formal offer yesterday to buy the remainder.
The family has long been impatient about the underperformance of the business in the face of big challenges in the beds market. Silentnight was into divans while customers wanted bedsteads.
At the same time, previous management squandered the company's cash on furniture acquisitions that proved disastrous.
The Clarkes have put in new management and said yesterday that the revival of Barnoldswick-based Silentnight was better carried out away from the public arena, where institutional shareholders demanded quick fixes.
Analysts believe the furniture business – where 800 jobs have already gone, factories have been shut and production sourced overseas – will be primed for sale.
They say Silentnight's leading position in beds, where it has about 26 per cent of the market, gives it a good chance to thrive if it catches up with the latest trends.
As well as its eponymous brand, the company makes Rest Assured and P&L in Batley and Barnsley, respectively.
Bedsteads of wood or metal can be imported relatively cheaply.
That's not the case with divans and mattresses, where most of the product is air. Silentnight chairman Roger Pedder said: "We're behind the game. We simply have to catch up."
The other trend is towards pocketed mattresses – a series of individual springs set in nests, or pockets – which are taking over from traditional mattresses, which are essentially one continuous mesh of springs.
In August last year the Clarkes first sought to buy back the company at an indicative price of 190p per share. But once they got inside, they found a worse situation than they imagined and withdrew the offer.
Having installed new management they came back with 140p per share in July. The deal yesterday indicates that the independent directors, who held the key to a recommendation, have bid them up.
The price is a premium of 32 per cent to that in July and up 12 per cent on Thursday. Yorkshire Bank is funding the offer.
The shares closed up 14p at 152.5p.
Mr Pedder said: "The sentiment in the business is that this is behind us.
"We're in a new, benign, climate but we're not complacent. We want to get on with putting this company back where it belongs."