Hugh Hefner, the octogenarian lothario who founded Playboy magazine in 1953, is taking his business empire back into private ownership, in a deal which values the soft porn company at $207m (£172m). Frustrated that his company's prospects no longer excite stock market investors, Mr Hefner, 84, has teamed up with a Michigan-based private equity firm to buy the minority of the company's shares that he does not own.
He first proposed a takeover bid for Playboy Enterprises last July, and independent directors have been examining the deal since then. Mr Hefner refused to consider selling his stake, in effect blocking a takeover by anyone else. The owners of rival Penthouse magazine had mooted a bid, but on Sunday night Playboy's board approved Mr Hefner's improved offer.
"With the completion of this transaction, Playboy will come full circle, returning to its roots as a private company," Mr Hefner said yesterday. "The brand resonates today as clearly as at any time in its 57-year history."
Under the terms of the deal, Playboy Enterprises will be bought by a partnership controlled by Mr Hefner with private equity money from Rizvi Traverse Management and debt financing from the investment bank Jeffries & Co, for $6.15 per share.
Mr Hefner reshaped the world of soft porn when he launched Playboy in 1953 with Marilyn Monroe on the cover. The company also expanded into nightclubs, television and, latterly, internet entertainment, but has suffered in recent years from increased competition. Mr Hefner, meanwhile, has been reinventing himself as reality TV star, inviting cameras into Playboy mansions. On Christmas Eve he proposed to his current "number one girlfriend", Crystal Harris, a 24-year-old model, singer and actress.