(Filed Under Fashion News). Playboy Enterprises Inc., whose licensing business now generates over $900 million in global retail sales, announced Monday that it is going private with the goal of transitioning into a brand management company.
The media and lifestyle corporation has entered into a definite agreement with Icon Acquisitions Holdings LP, a limited partnership controlled by Hugh Hefner, taking the company private at $6.15 per share. This price represents an 18.3 percent premium over the closing price last Friday and a 56.1 percent premium over the closing price on July 9, 2010, the last trading day before the initial announcement of the proposal.
Icon Acquisitions obtained equity commitments for the transaction from an affiliate of Rizvi Traverse Management and debt commitment from Jefferies & Company Inc. affiliates.
Scott Flanders, C.E.O of Playboy, will remain in his current position. “Our strategy is to transform Playboy into a brand management company,” he said. “This transaction will advance our efforts by strengthening our balance sheet and streamlining our operations, while creating opportunities to participate in new ventures.”
Hefner expressed his confidence that Playboy, which reported a net loss of $27.4 million during the third quarter of 2010, will experience success by going private. “I believe 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,” he said.
Ben Kohn, management partner of Rizvi Traverse’s Los Angeles office, echoed Hefner’s sentiment, saying: “This [transaction] will bring an end to a period of uncertainty for the company and provide the right ownership structure to develop the business.”
Playboy Enterprises licenses its name and imagery to consumer product companies, including Panties Plus Inc. for lingerie and Rubie’s Costume Company for costumes under the Secret Wishes by Rubie’s and Delicious lines.
Disclaimer: The views expressed in comments published on bodymagazine.us are those of the comment writers alone. They do not represent the views or opinions of Bodymagazine or its staff.
NOTE: Your Email will not be displayed.