By Paula Bernstein | Indiewire October 18, 2013 at 6:26PM
Wall Street reacted favorably to the news that Cinedigm is acquiring Gaiam Vivendi. The company's stock reached a 52-week high of $1.90 on Friday, closing at $1.77 in what was the biggest trading day in the history of the company.
L.A.-based Cinedigm is clearly looking to diversify its business by acquiring the entertainment assets of Gaiam Vivendi Entertainment for $51.5 million. GVE boasts some of the home entertainment industry's most recognizable brands, including Discovery Communications, Hallmark Channel, NFL Films, National Geographic, Marvel Animation, Shout Factory, Televisa, and World Wrestling Entertainment.
Last year, Cinedigm acquired New Video Group, a New York-based distributor of independent films, TV shows and specialty entertainment, for $14 million, but this is its largest acquisition by a long shot.
"This acquisition of GVE gives Cinedigm
immediate scale and leverage across the entire entertainment value chain," said Cinedigm Chairman and CEO
Chris McGurk in a statement. "The combination of GVE’s deep stable of
consumer-friendly brands and unique direct retail relationships -- paired with
Cinedigm’s tremendous strength in the rapidly evolving digital distribution
space as well as our theatrical releasing and over-the-top network businesses
-- creates a powerful and game-changing entity poised to take full advantage of
the content distribution revolution."
The company said that the deal will provide direct sales and marketing relationships with almost every major physical and digital retailer (including Amazon, Netflix, Wal-mart, Target and iTunes) and a library of more than 32,000 film and TV titles and episodes. The deal would also make the newly bolstered Cinedigm the largest aggregator and distributor of independent content, according to the company.
Effective immediately GVE President Bill Sondheim will become President of Cinedigm’s Entertainment Group (CEG), and will report to Chris McGurk and Adam Mizel, Cinedigm Chief Operating Officer and CFO. Sondheim previously worked for McGurk at Polygram Entertainment.