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Playboy goes private in $207M take over

Just a few weeks after his proposal to his girlfriend Crystal Harris, who is 60 years his junior, Hugh Hefner, 84, agreed today to take Playboy Enterprises Inc. private for $207 million. Hefner has increased his big to gain...
 Playboy goes private in $207M take over
 
 

Just a few weeks after his proposal to his girlfriend Crystal Harris, who is 60 years his junior, Hugh Hefner, 84, agreed today to take Playboy Enterprises Inc. private for $207 million. Hefner has increased his big to gain full control of the almost 60-year-old magazine, even though the publication has seen slumps in subscribers and sales.

Hefner has offered to buy Class A stock and Class B shares that he doesn’t already have his hands on for $6.15 per share, making for an 18 percent premium over the Class B closing price of $5.20 a share last Friday. He plans to pay $5.50 a share in cash for the stock in July. According to an article on BusinessWeek, the purchase ends a contest for control between Playboy and FriendFinder Networks Inc. who owns Penthouse adult magazine, and said that they would offer $210 million for Playboy. Playboy board member Sol Rosenthal said in a statement that Hefner’s bid is in the company’s best interests.

“Playboy’s agreement is with Icon Acquisition Holdings LP, a limited partnership controlled by Hefner. Icon has received commitments from Rizvi Traverse Management LLC and Jefferies & Co. to finance the transaction. Hefner owns 69.5 percent of Playboy’s Class A stock and 27.7 percent of the B stock,” according to the article.

“This agreement will give us the resources and flexibility to return Playboy to its unique position and to further expand our business around the world,” Hefner said in a statement.

Playboy Class B shares rose 87 cents, or 17 percent, to $6.07 at 10:28 a.m. in New York Stock Exchange trading. The stock increased 63 percent last year. Hefner has two sons, Marston and Cooper, who are hoping to become part of the executive management team, following his daughter, Christie Hefner, who departed as CEO in 2008.

Photo courtesy of LA Times



 



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