What happened
Shares of Casper Sleep (CSPR), a maker of sleep products such as beds, pillows, and sheets that it describes as "obsessively engineered," rose 12.5% at the open on Thursday. The gain relates to news that broke back in November, when the company announced it had agreed to be taken private.
So what
Casper Sleep held its initial public offering in February 2020, so it hasn't even been public for two full years just yet. However, the stock had long languished below its $12 offering price. In fact, in the back half of 2021, it started a steep descent that left it hovering just above $3 per share at one point. That was when Durational Capital Management stepped in with an offer to take Casper Sleep private for $6.90 per share. The share price jumped on that news and has been bouncing around a bit since then, but has largely stayed below the offer price.
Image source: Getty Images.
Generally, when a company agrees to be taken over, its shares will trade at a small discount to the agreed-upon price, because no matter how solid a proposal looks, there's always a chance that something could go wrong and scuttle the deal. However, Casper Sleep announced after the market closed on Wednesday that a major step toward getting this deal finalized had been achieved: In a vote, shareholders representing a majority of outstanding shares agreed to the offer. Thus, the stock gained ground -- though it's still trading a bit below the takeout price. Durational Capital Management's purchase is now expected to be completed during the week of Jan. 24.
Now what
Given that Casper Sleep is set to go private in just a few days, there's really not a whole lot for investors to do here. Highly conservative types who already hold shares might want to sell now and take their money off the table, just in case something goes wrong at the last minute. However, most will probably be fine just waiting for the cash from what looks like a done deal to hit their accounts.
