Piper Jaffray maintained an Overweight rating and $11.00 price target on Sequential Brands (NASDAQ: SQBG) following the company's announced acquisition of the yoga brand Gaiam. The deal is expected to close in the next 60 days. Currently, Gaiam sells a plethora of yoga clothing and related products in major retailer in the U.S.. The deal is expected to be accretive immediately, adding $22M in revenue and $20M in EBITDA on a 12-month run rate.

Analyst Erinn Murphy commented, "We are reiterating our OW rating on SQBG shares following the announced acquisition of Gaiam yesterday after close. The company is acquiring the athletic yoga brand for $146M via debt and cash on hand (or 7.3x the projected EBITDA run rate). Importantly, the deal is expected to close in the next 60 days and be immediately accretive. The acquisition is expected to add $22M in revenue and $20M in EBITDA on a 12-month basis. We view this acquisition favorably as it adds another layer to the fast growing athletic vertical. We believe SQBG has the opportunity to expand this brand into different channels and categories over time. We are leaving our estimates unchanged pending the closing of the deal. However, we have increased conviction in our OW rating on shares of SQBG, as the company continues to deliver strong high-single-digit organic growth and remains a serial acquirer of new brands."

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Shares of Sequential Brands closed at $5.81 yesterday.