FOR IMMEDIATE RELEASE

NAJAFI COMPANIES ACQUIRES DIRECTGROUP FRANCE, BELGIUM, SWITZERLAND AND QUEBEC FROM BERTELSMANN

Najafi's first international deal includes book clubs, travel and financial services, and online retail business

PHOENIX, Ariz. (March 23, 2011) – Najafi Companies, a Phoenix-based private investment firm, has finalized a deal that marks its first global acquisition. Najafi has agreed to acquire DirectGroup France, Belgium, Switzerland and Quebec, a billion-dollar, top-line consumer business, from the international media firm Bertelsmann. The sale is expected to close by the end of May. Financial terms were not disclosed.
 

Najafi already holds DirectBrands U.S., Bertelsmann’s former American club division. The company acquired DirectBrands – home to Book-of-the-Month and Doubleday Book Clubs, and Columbia House – in July 2008 and has significantly broadened the scope of the business. DirectGroup France (DGF) will operate separately from its U.S. counterpart.

“Based on the turnaround success of our DirectBrand investment in the U.S., we were motivated to add DirectGroup France to our portfolio of entertainment groups,” said Najafi Companies CEO Jahm Najafi. “We believe the timing is ideal to take DirectGroup France to a higher level of prominence abroad and look forward to working with its existing leadership to continue to build a leading brand.”

Najafi plans to invest significant capital into growing DGF over the next several years, including strengthening its book club model, travel and financial services, online retail division and network of chapitre.com libraries while expanding its existing suite of products.

Najafi Companies will retain and team-up with DGF’s current management to grow the company’s customer base, increase sales and raise its profile in the European direct marketing sector.

“DirectGroup France needed a strong and long-lasting investor to support our growth strategy,” said Jorg Hagen, managing director of DirectGroup France. “We are happy to welcome the Najafi Companies’ team to further develop our activities.”
 
Headquartered in Paris, DGF has locations in France, Belgium, Switzerland and Quebec. The business spans across retail stores, book clubs, travel services, e-books, financial services and an online portal for the purchase of books, DVDs and more. DGF brand, chapitre.com, is a market leader in on- and offline book retailing.

About Najafi Companies

Najafi Companies is an international private investment firm based in Phoenix, Arizona. The firm makes highly-selective investments up to $1 billion in size in companies with strong management teams across a variety of industries, and often in industries out of popular favor. The firm takes a long-term view on its investments and focuses its efforts to create value through growth and superior performance. Najafi Companies funds investments with internally generated capital, not through a fund. Free from the restrictions of a fund, the firm is able to move quickly and decisively when investing, and with no requirements to return capital to outside partners, Najafi Companies is able to make investments that create maximum value for the long-term. For more information about Najafi Companies, visit www.najafi.com.

About DirectGroup France
DirectGroup France is one of the major cultural products distributors in France, with a strong presence in small and medium sized cities. DirectGroup France includes the France Loisirs, the Grand Livre du Mois book club activities, the Internet site and the bookshops of the chapitre.com network. Since 2005, the group’s strategy has been refocused on a multi-channel integrated approach including new brands and complementary concepts, like direct marketing and book distribution.
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Media Contact: 
Anne Robertson/Greg Sexton
The Lavidge Company
Tel# 480-998-2600
arobertson@lavidge.com  
gsexton@lavidge.com

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