Playboy for sale?

From the Nov. 13,2009 Los Angeles Times:

Hef may soon have a new boss.

Brand management firm Iconix Brand Group and a group led by Jim Griffiths, Playboy's former entertainment president, are both in talks to acquire "gentlemen's" entertainment company Playboy Enterprises Inc. and take it private for more than $300 million, according to a person familiar with the situation.

Both companies have been talking to Playboy management for about a year, the person said.

Any decision about a purchase will come down to Hugh Hefner, Playboy's founder and public face, who controls about 70% of its voting stock. A buyer would have to persuade Hefner not only to relinquish control of the company he started 56 years ago, but probably also to stay involved given his importance to the brand.

A spokesman for Playboy declined to comment, as did a spokeswoman for Iconix.

Chicago-based Playboy's stock price plummeted last fall to just above $1 a share as it struggled with challenges in several of its businesses, including adult pay television, print and digital content. Revenue has fallen in the first three quarters of the year, and the company has cut costs. It recently reduced the guaranteed circulation of its magazine to 1.5 million from 2.6 million.

Former Playboy Chief Executive Christie Hefner left in December.

Playboy's market capitalization was just $136.3 million on Wednesday, including a 42% jump in the share price caused by a report of Iconix's interest earlier in the day. As of Sept. 30 it had $26.9 million in cash and $103 million of long-term debt, which starts to come due in March 2012.

Rumors that Playboy could be acquired started in February, when former interim Chief Executive Jerry Kern said it would be open to offers.

In July, former Freedom Communications Inc. chief Scott Flanders took over as chief executive. Many on Wall Street had viewed Flanders' appointment as a sign Hugh Hefner wanted to revive the company rather than sell it.

"You have Scott Flanders in there, who is putting a new corporate strategy into effect to turn the company around," said Steve Marascia, director of research at Capitol Securities Management in Virginia.

Flanders said in an interview with the Chicago Tribune that he wanted to grow Playboy by focusing on brand licensing and location-based entertainment, such as nightclubs.

That probably would be the plan as well for Iconix, which owns and licenses several well-known brands such as London Fog, Starter and Joe Boxer.

Griffiths, who was formerly president of Playboy's Entertainment Group, is working with San Francisco private equity firm Golden Gate Capital on his bid. If successful, it would see him take over the company as CEO and run it for Golden Gate, which would become the new majority owner.

Playboy shares rose $1.21, or 42%, to $4.07 on Thursday.

i buy now

for an undisclosed sum

interesting.

no surprise they're l*sing magazine sales, but the idea of themed location entertainment is pretty sweet.

Update:
From the Dec. 17, 2009 Los Angeles Times;

Iconix Brand Management has ended talks to acquire Playboy Enterprises Inc., according to three people familiar with the situation.

The adult-content producer and magazine publisher has been in talks with two potential buyers for the last year. In recent months, Iconix, which owns and licenses well-known brands such as London Fog, Starter and Joe Boxer, had emerged as the lead bidder in a deal that was expected to be worth more than $300 million.

The decision to sell publicly traded Playboy, which has struggled financially for several years, came down to aging founder Hugh Hefner, who controls 70% of the voting stock.

Iconix's main interest in Playboy was its brand name, which it hoped to license for consumer products and location-based entertainment.

According to two people close to the deal, Iconix was looking to sell Playboy's video production and pay-TV assets to stay out of the adult video content business.

The other main sticking point was what role would be played by Hefner, who is not involved in day-to-day management but is Playboy's public figurehead and serves as chief creative officer and editor in chief of its magazine.

Though talks with Iconix have ended, the people said, there is still a chance they could resume. For now, Chief Executive Scott Flanders, who took over this year from Hefner's daughter, Christie, will continue his efforts to turn around the ailing company.

Let's face it. Playboy has faded badly from its heyday. It is no longer cutting edge in any way and many of its recent ventures have included girls with less than Playboy quality: ugly girls, bad boob jobs. Whether it sells or continues as it is, does anyone really care anymore?

I remember when sneaking peeks at my dad's Playboy was the height of excitement...

thankfully, I have the internet now

the reality show is a joke, i think hefner has really hurt his image with this show.

hiring girlfriends thats basically what he's doing; although i envy his ability to do this.

the first set of gf's was actually entertaining, but its a business

I don't think Playboy ever managed to get itself out of the disco era style. I gave up on it back in the early 80s.

what happened to his daughter christie - she quit and i guess is just sitting in a room somewhere

kinda feel sorry for her

playboy sucks