In total, As Seen On TV would pay $13 million (in stock) for the company, and the agreement is expected to result in pro-forma ownership of two-thirds As Seen On TV shareholders to one-third eDiets.com shareholders.
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Combined, the companies generated approximately $30 mllion in revenue in the past year – eDiets.com alone generated $22 million in revenue over the past 12 months.
The acquired company is said to have spent $250 million to date since its inception in 1996 in building its brand through print media, TV commercials and Internet advertising. Here’s what As Seen On TV plans to do next:
“To-date customer acquisition has been driven by print media and short-form 30 and 60 second TV spots. The shared plan is to create, develop and utilize a long-form infomercial to more effectively acquire customers and spur growth of eDiets.com, Inc. subscribers.
The As Seen On TV, Inc. team, led by Kevin Harrington, has a vision in creating an infomercial utilizing celebrities and will utilize its expertise in production and media buy planning.
Additional opportunities include tying the eDiets.com, Inc. dietary meal delivery plan to other infomercial fitness products and the ability to upsell complementary fitness and household good products, two solid segments in the As Seen On TV world.”
If all goes according to plan, eDiets.com will become a wholly-owned subsidiary of As Seen On TV and will continue to be operated by its current management team.