Hefner to Buyout Playboy
Hefner, 84, is offering to buy the Class A stock and Class B shares he doesn’t already own for $6.15 per share, representing an 18 percent premium over the Class B closing price of $5.20 a share on Jan. 7, the company said in a statement today. Hefner said in July he would pay $5.50 a share in cash for the stock.
The decision by a Playboy board committee to support Hefner ends a contest for control with FriendFinder Networks Inc., owner of Penthouse adult magazine, which in July said it would offer $210 million for Chicago-based Playboy. The board determined Hefner’s bid is in the company’s best interests, Sol Rosenthal, a board member, said in a statement.
Hefner is Playboy’s largest shareholder with about 70 percent of the company’s voting shares and 28 percent of the nonvoting stock.
The company’s namesake magazine has struggled with competition from the Web, losing readers and advertisers. In November the company reported a wider third quarter loss than a year ago as its revenue fell 7 percent to $52.1 million.
Playboy’s management has been trying to transform the company from a publishing and TV business into a “brand management” company, leaning more on revenue from licensing out the Playboy name and bunny ears for a range of products.
