Hugh Hefner Offers To Take Playboy Private For $5.50/share

Playboy Enterprises (PLA), (PLAA) said Monday it received an offer from founder Hugh Hefner to take the company private in a deal which values the media and branding company at about $185 million.

Hefner has offered to buy all outstanding Class A and Class B stock not currently owned by him at $5.50 per share in cash, a premium of about 40% to Playboy’s closing price of $3.94 on Friday. Hefner currently owns 69.5% of co.’s Class A shares and 27.7% of Playboy’s Class B shares.

In a letter to the board of directors, Hefner said he is not interested in a sale or merger of Playboy or enter into talks with other financial sponsors out of concern for, “the Playboy Enterprises [PEI] brand, the editorial direction of the magazine and PEI’s legacy.”

According to the proposal letter, Hefner has had discussions with private-equity company Rizvi Traverse Management LLC, with whom Hefner expresses an intention to partner in connection with the transaction.

PLA rose the most in Russell 2000 Index, surging over 40% to $5.46 at 12:00 PM EDT  in New York Stock Exchange trading.

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