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CLEARWATER — As Seen on TV has signed a letter of intent to acquire eDiets.com in an all-stock transaction totaling $13 million, the company announced today.
As Seen on TV says in a release it plans to market eDiets.com using long-form infomercials with celebrities to help boost its sales and make the diet company profitable.
Both companies are publicly traded. eDiets.com, traded on the Nasdaq (symbol: DIET), recorded $7.12 million in revenues during the first quarter, but a net loss of $1.07 million. During the past 12 months, eDiets.com produced $22.25 million in revenues, but posted losses in net income in every quarter, totaling $5.08 million during that period.
Founded in 1996, eDiets.com is the third-largest national diet meal delivery company behind Nutrisystem and Jenny Craig.
As Seen on TV (symbol: ASTV, recent price: 75 cents), says in addition to marketing eDiets.com's meal delivery plan, it will use its infomercials to upsell complementary fitness and household good products, two solid segments in As Seen on TV's current sales.
Expected to close in 90 to 120 days, the deal will result in As Seen on TV shareholders' ownership consisting of two thirds As Seen on TV and one third eDiets.com, the release explains. eDiets.com will become a wholly owned subsidiary of As Seen on TV, and eDiets.com will continue to be operated by its current management team.
As Seen on TV, established by Kevin Harrington, is a direct-response marketing company that develops and markets products for distribution on TV, the Internet and retail channels.
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