Penthouse owner offers to buy Playboy for $210 million
FriendFinder Networks Inc., the owner of the Penthouse adult entertainment franchise, announced Thursday that it has made a proposal to acquire rival Playboy Enterprises Inc. for $210 million.
The move counters a bid this week from Hugh Hefner, who founded Playboy in 1953, to take the company private in a deal that would value it at $185 million.
FriendFinder Networks — which also owns dating websites, many of them adult-themed — faces a difficult battle.
Hefner owns 69.5% of Playboy’s Class A and 27.7% of its Class B common stock. The Class B shares in the company outnumber the Class A variety almost 6 to 1. But the Class A shares are the only ones with voting rights, giving Hefner unquestionable control.
Hefner has not officially commented on FriendFinder Chief Executive Marc Bell’s repeated expressions of interest in bidding for Playboy. But in a Twitter post Tuesday he said, “Playboy isn’t in play. I’m buying not selling.”
Corporate governance experts say the Playboy board has a fiduciary duty to consider any competing bids for Playboy stock. But it only has blocking power. It can’t force Hefner to sell his stock.
Playboy said Monday that it would form a special committee to evaluate the Hefner deal.
