ADULT PROPOSITIONS: Hugh Hefner would like his magazine back, but he may have to outbid Penthouse’s owners to get it. Playboy Enterprises Inc. said on Monday that its 84-year-old founder and current chief creative officer has floated a proposal to take the Chicago-based company private after nearly 40 years as a public venture. To complete the deal, Hefner would partner with private equity firm Rizvi Traverse Management to offer Playboy stockholders $5.50 a share in cash — a nearly 40 percent premium on Friday’s closing price of $3.94 a share — for all outstanding shares he does not own. Hefner currently holds 69.5 percent of the firm’s Class A shares and 27.7 percent of its Class B shares. The offer values the company at about $185 million, but could have competition as early as today. Shortly after Playboy disclosed Hefner’s proposal, Marc Bell, president and chief executive officer of Penthouse magazine parent FriendFinder Networks Inc., said his company is planning its own play for Playboy. “I think that there’s more value there,” Bell said, adding that he saw particular worth in Playboy’s digital properties. In addition to Penthouse, FriendFinder Networks owns a number of subscription-based social media sites that cater to a light years-wide spectrum of Internet interests, from JewishFriendFinder.com and BigChurch.com to AdultFriendFinder.com and Bondage.com. Sensing a potential bidding war, investors pushed shares of Playboy up more than 40 percent Monday to close at $5.55.
Playboy said Hefner made his move out of concern for the editorial direction of the magazine and the company’s legacy. The once robust men’s media empire has struggled in the Internet age as competition from more explicit offerings online has led to losses and forced the company to rely more heavily on licensing revenues. Still, the company has shown a recent willingness to at least try to evolve. It entertained an ultimately scrapped takeover bid from Iconix Brand Group late last year and, in a truly extraordinary move, announced plans for a safe-for-work Web site. — Matthew Lynch
This story first appeared in the July 13, 2010 issue of WWD. Subscribe Today.
MISSPENT YOUTH: Does Young Hollywood still sell at the newsstand? The celebrity weeklies have made millions off the shenanigans of the Paris Hiltons and Britney Spearses of the world, but, as of late, some are wondering if the formula is failing. Insiders claim Jessica Simpson’s turn on the covers of Us Weekly and OK magazine this past week didn’t pay off, and Nicole Richie’s Star magazine cover didn’t have registers ringing. Now, with Lindsay Lohan’s antics, some wonder which editor will roll the dice and put her on the cover. “[Young celebrities] are becoming less and less reliable,” said Rob Shuter, Naughty but Nice columnist from Popeater.com.
So, to whom will editors turn this week? Aside from Mel Gibson’s latest tirade, Lohan has provided an easy story for the tabloids to cover. Shuter noted that, while Lohan often makes the headlines, the seemingly never-ending story of her downfall hasn’t been a crowd pleaser when it comes to single-copy sales. Meanwhile, as one magazine insider put it, it’s hard to generalize when it comes to the weekly cover wars. “Sometimes a story is bigger than a star,” said the insider. “And sometimes it’s just about the star. A good sale is also dependent on what the competition does. One Lindsay Lohan cover could sell well, but three could mean all three magazines have bad sales.” — Amy Wicks
BONGO PLAYER: Audrina Patridge of MTV’s reality show “The Hills” already has lined up a new gig as the face of Bongo. Patridge replaces pop star Jesse McCartney. “Audrina was a natural choice for the campaign. She lives that glamorous, adventurous lifestyle that our Bongo customers are fascinated with,” said Dari Marder, chief marketing officer, who declined to disclose media buy figures. The line worn by Patridge will be sold exclusively in Sears and Kmart. The campaign will break in the September issues of Teen Vogue, Seventeen and Cosmopolitan. — A.W.