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SALT LAKE CITY — Alpine-based Purple, a company that's made waves in the business of direct-to-customer mattresses, pillows and other comfort products, announced Thursday a tentative merger deal worth $1.1 billion in cash and stock with New York City-based Global Partner Acquisition Corp.
The letter of intent signed by both companies outlines a compensation package that includes cashing out current Purple equity holders, expected to be about $90 million, with the remainder "being paid in rollover equity interests in the combined public company," according to a joint news release.
“We are excited to become a publicly traded company through our merger with GPAC," said Purple co-founder Terry Pearce. "The GPAC team is an ideal partner led by experienced public market investors and executives that will add significant value to Purple.
"We believe Purple is uniquely positioned in the market, and this transaction will allow us to better take advantage of our large market opportunity and continue our rapid, profitable growth.”
Purple founders Terry and Tony Pearce would remain majority shareholders under the terms of the deal and would continue to be involved with the company. Current Purple CEO Sam Bernards will also remain with the new, combined public company.
Purple has been expanding at breakneck speed since launching in January 2016, making inroads on the $15-billion-a-year U.S. mattress market.
The company grew from zero to $200 million in expected annual sales in just 1 ½ years, went from a handful of employees to a current workforce nearing 700, and recently opened a 574,000-square-foot production facility in Grantsville, adding to its original facility in Alpine.
Purple's mattress and pillow products feature a proprietary gel material that is engineered, according to the company, to distribute weight and conform to a sleeper's physique. The company also designed and built its own manufacturing equipment, something noted by GPAC CEO Paul Zepf in a statement about the merger.
“I believe Purple is a tremendous merger partner for GPAC, given its powerful brand and highly differentiated portfolio of comfort technology solutions," Zepf said. "The company’s revolutionary products, vertically integrated design and manufacturing expertise, and world-class marketing capabilities ideally position the company to disrupt multiple massive industries that are ripe for innovation.
"We are pleased to partner with Terry, Tony and Sam, and look forward to their continued leadership of Purple.”
The Pearce brothers, both engineers and Utah natives, have been innovating advanced materials products for decades, licensing their technology to other companies for use, including the ubiquitous blue gel in Dr. Scholl's products.
In 2010, the duo decided to create and sell their own comfort products, which led to the Purple mattress.