CITIC Capital Partners has bought Chinese mattress manufacturer and retailer King Koil Shanghai Sleep System for an undisclosed sum, according to a statement.
The firm did not say what stake it took in the business, but said it was a majority interest and had invested from its second China-focused buyout fund.
King Koil Shanghai makes premium mattresses under a number of different brand names, including King Koil itself, Aireloom and Life Balance. It owns the Chinese trademark for King Koil, a US brand founded in 1898, which is still a well-known international company.
“King Koil is a leading player in the premium mattress segment with strong brand recognition and a highly-skilled management team. We look forward to partnering with the management and other shareholders to strengthen the leadership in the hotel contract market and aggressively grow the retail sector in the coming years,” Yichen Zhang, chairman and chief executive of CITIC, said in a statement.
China’s retail mattress industry is expected to grow 15 percent per annum over the next five years and even more in the premium mattress segment, according to CITIC. Moreover, luxury hotel chains – some of King Koil’s best customers – are also showing signs of aggressive expansion in China.
“The highly-fragmented mattress market in China is currently undergoing rapid consolidation and we look forward to working with our new shareholder to become a major force in the market in future,” Stephen Wang, managing director of King Koil Shanghai, added.
CITIC Capital Partners is the private equity arm of CITIC Capital Holdings, operating in China, the US and Japan. The firm currently manages about $2.6 billion of committed capital on behalf of over 50 international investors.