Natural Foods Merchandiser

Gaiam to acquire home video powerhouse

Gaiam Inc. will control 37 percent of the market for wellness video programming with its proposed $40 million purchase of GoodTimes Entertainment, a creator and distributor of home entertainment products.

Broomfield, Colo.-based Gaiam said the purchase will make it the biggest direct distributor of home media in the country, with more than 40,000 retailers, 20 million catalogs and 7 million direct customers. It will have the sixth-largest market share for non-theatrical DVDs, according to ACNielsen's Videoscan.

Terms of the sale require New York-based GoodTimes to file for bankruptcy and auction its assets.

Gaiam President Lynn Powers termed the acquisition "a perfect strategic fit" because it gives Gaiam access to GoodTimes' distribution in mass markets. The company predicts annual revenue of more than $200 million after the purchase of GoodTimes.

Powers said GoodTimes products will be sold through Gaiam's existing specialty retailers, catalogs and more than 4,300 "store-within-a-store" displays.

GoodTimes specializes in multichannel marketing of its products, which are placed in retail chains as big as Wal-Mart and Target, sold through catalogs and touted on direct-response television, including shopping networks and infomercials.

Its video catalog contains more than 2,000 items, according to the GoodTimes Web site. It includes a number of popular fitness programs, including The FIRM, Cindy Crawford, TaeBo creator Billy Blanks, Richard Simmons, Leslie Sansone's "In-Home Walking" series and yoga tapes emceed by hip-hop entrepreneur Russell Simmons.

But it also distributes children's videos, including Peter Rabbit, Rudolph the Red-Nosed Reindeer, Felix the Cat and Benji, as well as "Charlton Heston Presents the Bible" and theatrical releases such as "The Omega Code" with Michael York and "Bells of Innocence" with Chuck Norris.

The GoodTimes deal comes on the heels of Gaiam's launch of a Scooby Doo branded series of yoga products for children.

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