FriendFinder Networks, parent company of Penthouse magazine, announced Thursday that it made a proposal to acquire rival Playboy Enterprises 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.
In addition to Penthouse magazine, FriendFinder Networks also owns dating Web sites, most of which are adult-oriented.
Shares of Playboy Enterprises (NYSE: PLA) have increased sharply since last week, jumping as high as $6.10 but falling to $5.52 at the close of trading on Thursday.
The current share price places the stock slightly above Hefner’s offer of $5.50-per-share bid price. Playboy’s stock was moving briskly on Thursday, with 4.48 million shares traded.
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 CEO Marc Bell’s interest in acquiring Playboy. But in a Twitter post Tuesday Hefner said, “Penthouse really isn’t in the picture. I’m buying, not selling.”
In a second Twitter post later Tuesday, Hefner said, “Penthouse is just looking for publicity. They’re not in the picture.”
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.
