Najafi Companies to Acquire Direct Marketing Unit from Bertelsmann

- Direct Group North America is home to household brands such as
'Book-of-the-Month Club' and 'Columbia House'

PHOENIX and GUTERSLOH, Germany, July 11 /PRNewswire/ -- Najafi Companies,
a Phoenix, Arizona-based private investment company, has agreed to acquire the
direct-to-consumer business, Direct Group North America, from Bertelsmann AG
the two companies announced today. The sale agreement, which was entered into
earlier this week, is expected to close in the third quarter of 2008.
Financial terms between the parties, both privately held, were not disclosed.
Direct Group North America is one of the largest direct marketers of
books, DVD's, and recorded music in the U.S. and Canada. Its many well-known
consumer brands, such as "Book-of-the-Month Club" and "Columbia House," serve
millions of members through their club catalogs and online.
"We are very excited to enter the direct-to-consumer business and to work
closely with Direct Group North America's management team to ensure the future
success and growth of the company," said Najafi Companies CEO Jahm Najafi. "We
believe that the winning combination of great brands and dedicated employees
signals an exciting new chapter in this company's story."
"We are pleased to announce the sale of Direct Group North America to
Najafi Companies, whose past investments have demonstrated an ability to
nurture and grow successful companies. Bertelsmann is committed to the US
market and will redirect resources to other business opportunities," said
Thomas Rabe, CFO of Bertelsmann AG, who oversees Direct Group North America
business on the Executive Board. Bertelsmann announced the intention to sell
Direct Group North America at its Annual Press Conference in March of this
year as part of a worldwide strategic review.
About Bertelsmann AG
Bertelsmann is an international media company encompassing television (RTL
Group), book publishing (Random House), magazine publishing (Gruner + Jahr),
music (BMG), media services (Arvato), and media clubs (Direct Group) in more
than 50 countries. Bertelsmann's claim is to inspire people around the world
with first-class media and communications offerings -- entertainment,
information and services -- and occupy leading positions in its respective
markets. The foundation of Bertelsmann's success is a corporate culture based
on partnership, entrepreneurial spirit, creativity, and corporate
responsibility. The company strives to bring creative new ideas to market and
create value.
About Najafi Companies
Najafi Companies is a 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 http://www.najafi.com.
About Direct Group North America
Direct Group North America is one of the largest direct-to-consumer
distributors of media products in the U.S. The company is home to such
marketing-leading book, DVD and music club brands as Doubleday Book Club,
Book-of-the-Month Club, Mystery Guild, Black Expressions and Columbia House.
The company serves millions of members in the U.S. and Canada through its
various club catalogs and online. Direct Group North America has offices in
New York, Pennsylvania, Indiana, South Carolina and Toronto, Canada.
SOURCE Bertelsmann AG

Tobias Riepe, Vice President Media Relations of Bertelsmann AG,
+49-5241-80-77-69, tobias.riepe@bertelsmann.de; or Anne Robertson,
arobertson@lavidge.com, or Greg Sexton, gsexton@lavidge.com, both of The
Lavidge Company for Najafi Companies, +1-480-998-2600