Mattress maker Purple Innovation Inc. PRPL said Thursday it is “disappointed” that within days of a special committee rejecting a bid for the company from Coliseum Capital Management LLC, the hedge fund is seeking to replace most of the board. “The Special Committee acknowledges that Coliseum, as a 44.7% shareholder of Purple, is entitled to reasonable representation on the Board, and notes that Coliseum’s Managing Partner Adam Gray has served on the Board since the time that Purple went public in 2018,” the company said in a statement. Gray has also served as chair of Purple’s nominating and governance committee since it was formed, giving the fund “significant” influence over those practices. But Coliseum’s proposal to overhaul the board “goes beyond what we consider appropriate: Coliseum is seeking the right to appoint, identify or approve every member of Purple’s Board, leaving Purple’s other shareholders with no representatives on the Board who have not been endorsed by, and who do not serve at the pleasure of, Coliseum.” Purple is still interested in working cooperatively with Coliseum and will seek to do that while protecting the interest of its other shareholders, said the statement. It described the $4.35 a share bid as ‘below-market.” The stock fell 4.9% in premarket trade and is down 38% in the last 12 months, while the S&P 500 SPX has fallen 13%.
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