Hedge fund Clinton Group said that it will vote for and participate in a $35 million financing transaction that the mattress maker entered into with private equity firm Sterling Partners in May. Under the terms of the deal, Sterling Partners agreed to purchase 50,000,000 shares of Select Comfort for 70 cents apiece, giving the firm a 52.5% controlling interest. The agreement also gives Sterling control of Select Comfort's board, and the private equity firm intends to replace the mattress maker's current chief executive officer, William McLaughlin, with its former chairman and one-time interim CEO, Patrick Hopf. Clinton Group supports the transaction, which is up for a shareholder vote on Aug. 27, and has entered into an agreement with Sterling Partners to participate in the deal -- through a $5 million investment. The money will go into a new limited-liability corporation set up by Sterling Partners for the purpose of its investment in Select Comfort. "We support the [Sterling Partners' investment], and believe it to be in the best interests of the issuer's shareholders," Clinton Group stated in its Schedule 13D. " will improve [Select Comfort's] current capital structure, allowing it to address its liquidity needs and pursue long-term growth opportunities that become available." Clinton Group owns 3,262,638 shares (7.2% of total outstanding). The firm sold 429,807 shares from Aug. 5 to Aug. 14 at prices ranging from $2.27 to $2.89 each.

Real Estate Investment Group, which is controlled by the Argentine real-estate magnate Eduardo Elsztain, disclosed ownership of 11,909,587 shares (19.68%). The firm purchased 5,700,000 shares at $2.50 and acquired options for an additional 5,700,000 shares at $3 directly from the real-estate investment trust on August 4. As part of the purchase agreement, Elsztain will join the board of trustees of Hersha Hospitality Trust.

Gamco Investors (GBL) disclosed that it now owns 7,865,768 shares (6.1%). The firm paid a little more than $125.1 million, or about $15.90 a share, to acquire the holding.

Baker Bros. Investments increased its holdings to 5,771,072 shares (20.2%), after purchasing 189,344 from Aug. 10 to Aug. 17 at $19.70 per share.

Farallon Capital Partners reduced its holdings to 26,660,822 shares (8.2%), after selling 3,131,501 from July 30 to Aug. 13 at $3.84 to $4.69 each.

Silver Creek Capital Management decreased its holdings in Flagstone Reinsurance Capital Holdings to 9,225,758 shares (10.9%), after selling 2,000,000 shares back to the company on Aug. 13. The price per share was not disclosed.

Tiger Global Management reduced its holdings to 4,439,534 shares (8.7%), after selling 1,873,647 from June 15 to August 12 at prices ranging from $26 to $30.77 apiece.

Bankrate's board approved a merger pursuant to which the company will be acquired by private-equity investment group Apax Partners for $28.50 per share, via a tender offer and merger. Coatue Management, which has a 9.5% stake, wrote to Bankrate's board to express disappointment with the board's decision, and stating that it will not tender its shares.