The country's largest mattress retailer appears headed to bankruptcy this week as its South African parent company continues to fight through an accounting scandal.

Mattress Firm is preparing to file for bankruptcy protection in order to help it clean up its costly real estate portfolio and shutter struggling stores, Reuters reports, citing anonymous sources. This follows a report almost two months ago by Reuters that Mattress Firm had tapped AlixPartners, a firm that aids companies' turnaround strategies, for a possible bankruptcy.

Bankruptcy could give Mattress Firm a green light to close stores that are clustered together in many of its markets, a result of the retailer's rampant growth by expansion and acquisition. Its real estate strategy is at the heart of a fraud lawsuit the retailer filed against its former real estate heads and retail broker. The lawsuit claims one portion of the scheme alone — a $50K broker fee per lease — could have cost the retailer at least $40M in excess payments. That accounts for roughly 800 locations.

“Bankruptcy would allow the company to clean up its real estate portfolio, get out of bad leases and improve cash flow and profitability,” Piper Jaffray analysts stated in an August report. “The irrational behavior has been disruptive, and Mattress Firm pulling back on advertising has been damaging to mattress industry traffic trends.”

Sources told Reuters that the bankruptcy process could be finished in a couple of months, with Mattress Firm's vendors expected to be repaid in full.

Mattress Firm's parent company, Steinhoff International — which bought Mattress Firm in 2016 for $3.8B and is itself battling through scandal — announced that Mattress Firm lost more than $150M on nearly $1.5B in sales for the first half of 2018. The retailer shuttered 149 stores between September of 2017 and March of 2018.

Last November, Mattress Firm accused former Colliers International Atlanta executive Alexander Deitch of being one of the ringleaders — along with former Mattress Firm in-house real estate executives Bruce Levy and Ryan Vinson — in a scheme to steer the company toward high-priced real estate in exchange for developer kickbacks and other incentives.

Deitch filed a countersuit earlier this year. Deitch claims that Mattress Firm entered into leases that were above market rates because of its aggressive growth strategy and desire to corner the mattress retail market, including at times outbidding competitors to steal market share.

Mattress Firm’s real estate committee — which was manned by a number of top executives, including current Chairman and CEO Steve Stagner and former CEO Ken Murphy — had full knowledge of those deals and signed off on them, Deitch claimed in the suit.

Efforts by Mattress Firm to dismiss that countersuit were blocked by a judge last month.