Tempur Sealy International (TPX) on Monday said it has taken steps to get its planned $4 billion takeover of rival Mattress Firm approved by regulators. 

The bedding company reported that it agreed to sell 73 Mattress Firm retail locations and its Sleep Outfitters subsidiary, which has 103 retail outlets and seven distribution centers, to privately held Mattress Warehouse.

Tempur Sealy Chief Executive Officer (CEO) Scott Thompson explained that the move came after the company "conducted a divestiture process" as part of its talks with the Federal Trade Commission (FTC). The FTC has challenged the Mattress Firm deal, arguing that it would hurt competition and raise mattress prices for consumers.  

Hearings on FTC Challenge Set To Begin in November

Tempur Sealy noted that hearings on the challenge are set to begin Nov. 12 and last two weeks. It continued to argue that it expects to win the case, and believes the acquisition will close late this year or early next year. 

In addition to the Mattress Warehouse agreeement, Tempur Sealy also announced it planned to offer up to $1.6 billion in debt that will mature in seven years. The company said that the money raised, along with that from other debt, would be used to pay the cash considerations of the Mattress Firm purchase.

Tempur Sealy International shares slipped less than 0.5% soon after markets opened Monday but are up about 5% year-to-date.