SCC to Acquire Silk & Snow
Sleep Country Canada Holdings (SCC), this country’s largest sleep goods retailer, will acquire 100 % ownership of Silk & Snow, one of Canada’s fastest growing direct-to-consumer sleep brands specializing in thoughtfully curated, high-quality sleep and lifestyle products.
The deal is expected to close on January 1, 2023.
In a statement, SCC management noted Silk & Snow launched its e-commerce site with a made-in-Canada single memory foam mattress in 2017 following a successful Kickstarter campaign.
Co-founded by Albert Chow and Kenneth Mo with the goal to create a perfect, locally made matter delivered directly to the consumer’s door in a box, it has since grown into a one-stop, curated lifestyle brand offering mattresses, furniture, bed essentials and its new bath line-up. For three consecutive years, Silk & Snow has been ranked as one of the fastest growing companies in Canada. In 2020, Silk & Snow made Canadian Business’ top 10 start-up list ranking of Canada’s Fastest Growing Companies. In 2021 and 2022, it was ranked one of Canada’s top growing companies by the Globe & Mail.
Silk & Snow has also made inroads into the U.S. market which accounts for approximately 25% of sales in the most recent fiscal year.
“We are delighted to welcome Silk & Snow to our growing family of powerful sleep brands as we continue to build our sleep ecosystem with investments in people, product and channel innovation to provide customers with seamless access to the world’s leading assortment of sleep essentials,” SCC president and chief executive officer Stewart Schaefer said.
“Albert, Kenneth and the Silk & Snow team have thoughtfully procured a full array of affordable luxury items that have helped turn their brand into a high-growth business with an impressive following in both Canada and the United States,” he continued, adding, “Their purpose-driven approach to product design, manufacturing, and digital marketing aligns beautifully with our strategic road map and expansion of sustainable products, and into new markets. We look forward to supporting Silk & Snow as the brand aims to continue its incredible growth trajectory.”
Silk & Snow is the third digital retailer in SCC’s stable joining Endy, which the latter acquired in November 2018 and Hush, which it bought last year. Over the past few years, SCC has added a number of brands to enhance and strengthen what it calls its ‘sleep ecosystem’. Among these are Simba, Casper and Purple.
SCC said it will acquire all Silk & Snow’s assets for a total of approximately $43 million – $24 million of which will be paid in cash on closing. The balance will be paid in early 2026 should Silk & Snow achieve certain growth and profitability targets in 2023, 2024 and 2025. The transaction will be financed through Sleep Country’s cash on hand and revolving credit facility.
“We’re proud of what our team has been able to build here at Silk & Snow,” its CEO and co-founder Albert Chow said. “We started Silk & Snow with the intention of providing high-quality products that allow our customers to love their homes. Five years later, with quality as a top priority, we’ve delivered on our promise of building a brand that offers thoughtfully made sleep products.”
“It was important for us to find a partner with Canadian roots,” chief operating officer and co-founder Kenneth Mo added. “We’re looking forward to partnering with Sleep Country, Canada’s leading sleep retailer, as it allows us to lean on their incredible expertise. This will help us to continue to expand our well-loved range of mattresses, bedding, furniture and bath products, while bringing even more value to our customers.”
Silk & Snow will operate as an independent entity within Sleep Country, led by Chow as CEO and Mo as COO who both will join the Sleep Country’s senior leadership team.
Industry and financial analysts have estimated Silk & Snow’s revenue for its latest fiscal year at $34 million. Its product assortment includes bed sheets, mattresses, bed frames, weighted blankets, and other home essentials such as bath towels and robes. It also recently signed a deal that will see Indigo Chapters display its product on some of its 87 stores nationwide. Silk & Snow is the only mattress brand sold on the floors of contemporary furniture retailer EQ3 at its 16 stores in Canada and the United States.