Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Hugh Hefner taking Playboy private

chart_ws_stock_playboyenterprisesinc.top.pngShares of Playboy surged in July after Hugh Hefner first proposed taking the company private. By Aaron Smith, staff writer


NEW YORK (CNNMoney) -- Playboy founder Hugh Hefner signed an agreement to take his publicly-traded company private, the company said Monday.

Hefner, who already owns a substantial amount of the company's shares, has entered an agreement with Icon Acquisition Holdings to pay $6.15 per share for the portion of Playboy Enterprises that he does not own.

This would be an 18% premium from Playboy's (PLA) closing price of $5.20 per share on Friday. At the start of trading on Monday, shares surged 17%.

"With the completion of this transaction, Playboy will come full circle, returning to its roots as a private company," said Hefner, who created the pornographic magazine with its iconic bunny logo 57 years ago.

Hefner, through his trusts, owns 69.5% of the class A shares and 27.7% of the class B shares. He expects to close the deal by Jan. 21.

This ends an ongoing bidding war with another porn icon, Penthouse. FriendFinder Networks, the owner of Penthouse magazine, offered to buy Playboy for $210 million in July, 2010. At the time, that translated to $6.24 per share.

That offer was in response to Hefner's original plan to purchase the outstanding shares for $5.50 each, which valued Playboy at $185 million.

Playboy has been struggling with profitability in recent years, given the proliferation of free, online pornography. To top of page

Index Last Change % Change
Dow 18,228.30 133.47 0.74%
Nasdaq 5,305.71 48.22 0.92%
S&P 500 2,159.93 13.83 0.64%
Treasuries 1.56 -0.03 -2.08%
Data as of 10:30pm ET
Company Price Change % Change
Chesapeake Energy Co... 6.23 -0.39 -5.89%
Bank of America Corp... 15.29 0.20 1.33%
Procter & Gamble Co 88.36 0.51 0.58%
Ford Motor Co 11.98 -0.03 -0.25%
Micron Technology In... 18.00 0.64 3.69%
Data as of 4:15pm ET
Sponsors

Sections

Wells Fargo CEO John Stumpf has forfeited about $41 million worth of equity rewards as punishment for the company's massive fraud scandal. More

Despite attacks from Republicans including Donald Trump, the Federal Reserve is a big money maker for U.S. government. More

SpaceX CEO Elon Musk laid out his plan to put humans on Mars to eventually form a self-sustaining colony. More

Low interest rates have pushed some housing markets around the world into bubble-risk territory, according to a new report out of UBS. More