Latest acquisition will boost retail sales to more than $320 million, company says
Cinedigm has acquired home entertainment company Gaiam Vivendi Entertainment (GVE) for $51.5 million, the company announced Thursday. GVE was a division of Gaiam, a health and wellness company, that became a player in the home entertainment space when it bought Vivendi Entertaiment.
GVE holds licenses to TV shows and specials from the WWE, NFL, National Geographic, Discovery and several other companies.
“It is one of those rare transactions that works on every level,” Cinedigm CEO Chris McGurk told TheWrap. “They are so strong with brands and with physical distribution (DVDs). Our strength is in digital and theatrical releasing.”
With GVE on board, Cinedigm will now have annual retail sales of more than $320 million and a library of more than 32,000 titles and episodes. McGurk also hopes to use GVE's library to provide videos for its over-the-top offerings, like its Docudrama YouTube channel.
“We intend to launch a bunch of other channels,” McGurk said. “All of these brands could be used to launch networks; we have such a huge library of digital rights.”
The company used a $40 million credit facility to help finance the acquisition, but McGurk said the move will add $15 million to Cinedigm’s bottom line each year.
He compared this deal to Lionsgate's acquisition of Artisan, which turned that company into a dominant player in the independent distribution business.
“That really gave them the leverage, scale and cash glow to grow the business dramatically,” McGurk said. “We'd like to think we're at that same stage.”