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Playboy adds Spice
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February 4, 1998: 9:04 a.m. ET
Publisher says it is acquiring Spice Entertainment for $95 million
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NEW YORK (CNNfn) - Playboy Enterprises Inc. added some spice to its television offerings Wednesday by announcing it will acquire Spice Entertainment Companies Inc., a provider of adult-oriented pay-per -view television, for about $95 million.
Playboy said it will pay $3.60 cash and 0.1524 share of Playboy stock (PLA) for each Spice (SPZE) share.
Spice stockholders will retain ownership of Spice's digital operations center for video and Internet broadcasts and have options to acquire the outstanding stock of Emerald Media, Inc., another pornographic video firm.
Playboy Entertainment already offers Playboy TV and AdulTVision, which reach 17.9 million U.S. cable and satellite households. For the first nine months of 1997, those networks had revenue of $52 million.
New York City-based Spice's networks, Spice and Adam & Eve, reached 21.5 million households and had revenue of $22 million during the same period.
Playboy Enterprises CEO Christie Hefner, daughter of Playboy founder Hugh Hefner, said the acquisition will "significantly enhance Playboy's fast-growing and high-margin television business."
The companies expect the purchase to be completed during the second quarter.
Separately, Playboy Enterprises said Wednesday it had net income of $1.1 million, or 5 cents per share, during the fourth quarter.
The company said it took a one-time charge of $1.1 million during the quarter due to start-up costs of several ventures, primarily its casino gaming activities. It also described the performance of its publishing group, which includes Playboy magazine, as "weak."
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