Playboy Magazine has been the foundation for million American male libidos since its creation is 1953. It’s creator Hugh Hefner, has decided to purchase back all the $157 million dollars worth of shares that are currently not owned by Hugh himself. Yes, he is going to take Playboy Enterprises private once again.
The male adult industry has been a questioning industry for many years. With the millions it has generated across the globe, it is an empire that many conservative groups have tried to put a stop to. Mr. Hefner has been worried about the brand for the last several months and has decided to bring it back into the family. Hefner decided to partner with the Rizvi Traverse Management LLC for the transaction. Hefner stated to his partners and his board that he is not interested in selling the organization to the public or any other third party interested in Playboy Enterprises.
Many businesses and consumers are wondering why Hefner has decided to bring the company back into the family. Hefner’s daughter who has been the CEO of Playboy Enterprises till 2008 when she moved on, also had concern of the family legacy. Some of the main reasons why Hefner has decided to bring the company a bit closer to the chest is to access more private capital, control the brand, and make sure the business is ran the way its family desires.
Hefner will purchase the remaining Class A and Class B stock for a total of $123 million to seal the deal. This makes the Playboy Enterprises stock to about $5.50 per share. Hefner’s board has not yet made a decision or commented on the buy out as far as the public knows.
Playboys new CEO Scott Flanders, believes that Playboy is a billion dollar brand and today has a value of about $200 million. Along with Hefner, Flanders is going to downsize Playboy Enterprises and make it more efficient as far as operations.
Playboy sales have declined in the past two years due to Internet competition and plans on hitting the Internet hard in the next several months to come.
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