In a deal that will create a $2.7 billion mattress powerhouse and change the face of the sleep-products industry, Tempur-Pedic has signed an agreement to purchase Sealy for a total transaction value of $1.3 billion.

To close the deal, Tempur-Pedic will pay $2.20 a share for all of Sealy’s outstanding stock, representing a premium of about 23 percent on Sealy’s 30-day average closing price on Sept. 26. In addition, Tempur-Pedic will assume or repay all of Sealy’s outstanding convertible and non-convertible debt. The transaction is expected to close during the first half of 2013.

Sealy, one of the largest bedding manufacturers in the world, made several news-making moves at the Las Vegas Market.

The bedding giant acquired a non-controlling interest in Comfort Revolution, the foam products manufacturer headed by Sleep Innovations founder Michael Fux. Sealy also showed a “promotionally priced” Memory Foam line, along with a collection from Stearns & Foster.

By David Gill

Bed bugs have become a major health crisis in some American cities, and not surprisingly consumers are looking for solutions.

Infestations have been reported in various media, in marquee locations such as the Empire State Building, and unexpected places such as the Cincinnati Public Library. Aside from the nation’s bedrooms, they have been reported in hotel rooms, clothing stores, public schools and even movie theaters.