Sleep Number confirmed its Nasdaq-listed shares will be delisted when the market opens Tuesday, June 23, following its voluntary Chapter 11 filing on Friday, June 12. The company’s stock fell sharply in trading around the news, and it warned current shareholde
When the market opens next Tuesday, June 23, Sleep Number Corporation’s stock will no longer be publicly traded on Nasdaq.
In an SEC filing, the mattress and bedding company said it received a written notice from the exchange’s listings qualifications staff and that its shares (Nasdaq: SNBR) will be delisted after it filed for Chapter 11 bankruptcy on Friday, June 12.
Sleep Number said the Nasdaq decision was based on the Chapter 11 filing and “associated public interest concerns,” along with concerns about the “residual equity interest of common stockholders” and the company’s ability to maintain compliance with Nasdaq’s continued listing requirements.
The timing lands after a sharp selloff. Sleep Number’s shares fell more than 50% in after-hours and into premarket trading on Thursday. By the close on Wednesday, the stock was already down over 95% year-to-date (YTD).
Despite the delisting, the company said it is not expected to impact the Chapter 11 proceedings.
For shareholders, the message is harsher. Sleep Number told investors that its “common stock may be quoted on over-the-counter markets,” but it offered no assurances about whether broker-dealers will provide quotes or whether an efficient market will develop.
Linda Findley, Sleep Number’s CEO and president, said the company sought Chapter 11 protection because its “capital structure remains unsustainable.”
The company also pointed to an outcome that would reshape the business. Sleep Number said it will merge with Sleep Country Canada to create a larger North American mattress and bedding company. As part of its bankruptcy process, Sleep Number expects to receive up to $260 million of debtor-in-possession financing after declaring bankruptcy.
Findley added that the plan, along with a court-supervised sale process tied to the Sleep Country Canada agreement, is meant to address “financial constraints” and position the company to expand—both in the United States and through future international expansion.
But the delisting and the Chapter 11 case are already casting a long shadow over equity holders. In its announcement. Sleep Number said it “expects that holders of shares of the Company’s common shares will experience a complete or significant loss on their investment. depending on the outcome of the Chapter 11 Cases.”.
Even so, Sleep Number said it plans to keep its brick-and-mortar and online stores operating as usual during the bankruptcy process—so the company’s commercial footprint remains in place while the ownership and capital question moves through court.
Sleep Number SNBR Nasdaq delisting Chapter 11 bankruptcy Linda Findley Sleep Country Canada debtor-in-possession financing mattress industry stock plummets