Sequential Brands Group, has signed a definitive agreement to acquire the branded consumer product business from Gaiam, Inc. for a total purchase price of approximately $146 million in cash. The acquisition will be funded by a combination of cash and debt financing.
As part of the transaction, Sequential will acquire Gaiam’s yoga, fitness and wellness product business – which includes the GAIAM and SPRI. The “bolt-on acquisition” will be integrated into Sequential’s Active Division, which is currently anchored by the AND1 and Avia brands.
In tandem with the acquisition, Sequential signed long-term licensing agreements for the brands’ core categories, which will become effective upon closing. Fit For Life will be the licensing partner for the hard goods and equipment categories as well as the digital properties, and High Life will be the licensing partner for Gaiam’s yoga and athleisure apparel business.
Gaiam’s distribution network consists of approximately 38,000 retail doors, 19,000 store within stores, 5,000 category management locations, e-commerce, and a newly acquired mobile platform which features Yoga Studio, a paid yoga app for Apple, mobile, and tablet devices with more than one million downloads to date.
“The combination of Gaiam’s innovative products and authenticity in the active lifestyle space, coupled with Sequential’s extensive retail relationships and strategic approach to brand building sets the stage for taking both the brands to new levels,” said Gaiam CEO Lynn Powers.
According to Eddie Esses, Active Division President at Sequential, “over 35 million people in the U.S. practice yoga today, up 76% in the past 4 years, and another 80 million aspire to practice yoga.”
Yehuda Shmidman, CEO of Sequential, commented, “We believe this is a home run for Sequential. The acquisition is immediately accretive to earnings, and aligns with our long-term playbook of acquiring brands with significant, untapped potential where we can immediately unlock value and position them for long-term organic growth.”
