Sealy Corporation ZZ (NYSE), one of the largest the bedding manufacturers in the world, announced on Wednesday its chairman and CEO, David McIlquham who had led the firm for six years was leaving immediately. The board appointed Lawrence Rogers, a twenty nine year employee of the firm and since 2006 president of the firm's North American operations, the interim CEO. The company also announced that board member Paul Norris was named non-executive chairman. Norris is a former chairman and CEO of W.R. Grace and Company and, most significantly, a senior advisor at Kohlberg Kravis Roberts and Company (KKR), Sealy's largest shareholder. The company has also initiated a search to find a permanent CEO.
The management changes come as Sealy's performance and sales have been suffering in conjunction with the continuing decline in housing and the overall softening of the economy. It is expected that Sealy will seriously examine its overall strategic approach to its business as the company continues to see slowing growth, particularly in its North American marketplace. Sealy was formerly owned by investment firm Bain Capital. In 2004 the firm was bought by KKR. In 2005, the company filed an IPO and began trading in March 2006. Since going public the company has been expanding its US operations, it is possible that focus may shift. Sealy continues to maintain a strong market position as compared with its competitors. Its size has afforded the firm the ability to operate a large scale operation that controls virtually all phases of production, a situation that does not apply to its competitors.
Keep a very close eye on the moves the company takes for the next few months. It is likely that Norris will play a very important role in the next steps the company takes and will be very important in the ongoing CEO selection process.
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