South African-based international retail holding company, Steinhoff, has agreed to acquire Mattress Firm at a total equity value of approximately $2.4 billion and an enterprise value of ±$3.8 billion including net debt.

This follows the notable trend among South African retailers who have attempted to acquire established retailers in developed markets such as Europe and the United States. As growth in what was formerly Africa’s largest nation  began to slump in 2012 and the Rand began to weaken against the Dollar, South African retailers have aggressively explored investment opportunities away from home. Earlier this year, Steinhoff put in a bid to acquire French electronics retailer Darty Plc, but was outbid by Fnac SA.

Steinhoff’s investment in Mattress Firm will create the world’s largest multi-brand mattress retail distribution network and facilitate Steinhoff’s entry into the U.S. Similar to the European retail mattress market, where Steinhoff is a leader, the North American mattress industry has demonstrated long-term stability and consistent growth. Mattress Firm represents an attractive investment proposition to Steinhoff through its national footprint and leadership in the U.S. mattress retail market.

The acquisition price is a premium of 115% to Mattress Firm’s closing price of $29.74 per share at the close of trading on August 5, 2016. Steinhoff paid $64.00 per share in cash.

Markus Jooste, CEO of Steinhoff said:

“The boards of Steinhoff and its management team are enthusiastic about the opportunities this transaction creates. This transaction will allow Steinhoff to not only enter the U.S. market with an industry leading partner and a national supply chain, but it will also expand Steinhoff’s global market reach in the core product category of mattresses. The Mattress Firm brand and speciality retail concept are a strong complement to the Steinhoff group retail brand portfolio in the many geographies where the group operates.”