Nutraceutical Acquires Arizona Health Foods

Nutraceutical Acquires Arizona Health Foods

PARK CITY, UtahNutraceutical International Corp. (NASDAQ:NUTR)announced July 1 it had acquired the operating assets of Phoenix-based ArizonaHealth Foods Inc. through Nutraceuticals subsidiary Fresh Vitamins Inc. for apurchase price of approximately $3.5 million in cash. In addition, theshareholders of Arizona Health Foods entered into non-compete and consultingarrangements.

Health food stores that focus on nutritional supplements are the heart andsoul of our industry, said Bill Gay, chairman and chief executive officer ofNutraceutical International (www.nutraceutical.com).As a supplier to Arizona Health Foods for many years, we believe thisacquisition is an important part of our overall business strategy and will helpus better understand our core customers.

Arizona Health Foods owns and operates a chain of 11 health food stores,which primarily sell branded nutritional supplements. Hal Cooper, president ofthe operation, noted his son, Greg, will remain with the company as vicepresident and general manager. He also stated the acquisition should help growthe Arizona Health Foods business. We have been a leader in the sale ofnatural health products since 1968, and I believe Nutraceutical is the rightpartner to help us grow our business and serve our customers in todayscompetitive market, Cooper said.

Nutraceutical is a large manufacturer and marketer of branded nutritionalsupplements sold to health and natural food stores. The company sells itsbranded products under several names, including Solaray, NaturalMax and,most recently, Natures Life. Nutraceuticals acquisition of NaturesLife was completed in mid-June. In addition, Nutraceutical publishes, prints andmarkets a line of books and booklets under the Woodland Publishing name.Nutraceutical also manufactures bulk materials for use in its own products andfor sale to other manufacturers and marketers under the trade names MonarchNutritional Laboratories and Great Basin Botanicals.