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Bed manufacturer Sleepyhead has bought award-winning Tauranga-based bedding and furniture maker, Design Mobel.
The deal, which takes effect on August 1, will see Design Mobel continue to operate as a standalone business unit.
Sleepyhead general manager Chris Taylor said the acquisition would strengthen its market position.
"As a company committed to remaining in New Zealand, we see this purchase as part of our ongoing strategy of growth and investment here."
Design Mobel founder Dave Macfarlane, who started the company 20 years ago, said the deal would allow him to pursue other interests.
The company is the country's top producer of specialist mattresses for flexi slat systems in New Zealand, and has won 20 major design awards during the past four years.
Taylor said the company had an "outstanding Kiwi brand", and was a good fit with Sleepyhead.
There were also synergies to be gained from the two operations.
Sleepyhead, which was established in Auckland in 1935, manufactures from three plants around the country.
