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RSSLexington Herald-Leader (Lexington, Ky.)
By Jim Jordan, The Lexington Herald-Leader, Ky.
Sep. 15--Tempur-Pedic International's largest shareholder, TA Associates, has sold about 5 million shares, or 6 percent of the Lexington company's stock.
News of the sale led to a drop in price yesterday of 83 cents a share, or 4.58 percent, by the close of trading on the New York Stock Exchange.
The sale involved more than 32 percent of the 15.55 million Tempur-Pedic shares owned by the Boston-based private equity firm.
TA Associates is expected to make more such sales because Tempur-Pedic is not the type of company it wants to invest in, said Robert Straus, an analyst with Merriman Curhan Ford & Co. in New York.
Tempur-Pedic has "solid business fundamentals," Straus said, but TA Associates "invests in early-stage companies and Tempur-Pedic is no longer an early-stage company.
"I would expect that TA Associates will continue to sell the balance of its stake at some point," Straus said.
Tempur-Pedic announced the sale "in response to market inquiries" about an hour after trading began yesterday.
On Tuesday, the company's stock hit a new 52-week high of $18.12 a share, but yesterday's announcement caused the stock to fall as low as $16.60 before rallying to close at $17.29 a share.
The daily trading volume, which averages 869,852 shares, was high both days -- 2,073,500 shares on Tuesday and 2,879,200 yesterday, the highest volume since Feb. 10.
TA Associates and the San Francisco-based investment firm of Friedman, Fleischer & Lowe bought Tempur-Pedic in 2002 for $350 million and sold its stock to the public in 2003. Tempur-Pedic's market capitalization now totals $1.43 billion.
The company makes and distributes visco-elastic mattresses, pillows and other products worldwide. Its stock symbol is TPX.
Reach Jim Jordan at (859) 231-3242 or 1-800-950-6397, Ext. 3242, or jjordan1@herald-leader.com [mailto:jjordan1@herald-leader.com].
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Copyright (c) 2006, The Lexington Herald-Leader, Ky.
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