The group that owns the fading Playboy brand on Thursday rejected a $100 million buyout offer from Cooper Hefner, the son of the magazine’s late founder.
“After careful review and consideration of Hefner’s unsolicited proposal, our Board determined that the proposal substantially undervalues the Playboy assets and is not in the best interest of PLBY Group’s stockholders,” CEO Ben Kohn said in a statement.
“While we certainly understand and are appreciative of the interest in Playboy’s unparalleled brand, the Board is confident that the Company’s continuing pursuit of its Playboy-focused, asset-light model will better support long-term value for stockholders,” Kohn said.
The board decision was unanimous, the company said.
Playboy Group plunged as much as 11% on news of the rejection but recouped some of the losses to close down 3%, at 81 cents a share.
Kohn said the board “will continue to evaluate all options and opportunities for Playboy,” leaving the door open for a revised deal.
Hefner, 33, revealed on Monday that he and his investment firm, Hefner Capital, had made a bid to regain the company made famous more than seven decades ago by Hugh Hefner.
“The decision to acquire Playboy’s assets stems from a personal connection and the unique potential to reinvigorate a brand cared for around the world,” Hefner told The Hollywood Reporter. “This effort is about safeguarding a legacy built over decades, ensuring that the creativity, values and cultural relevance that defined Playboy are not lost.”
Hefner, whose investor group includes a hedge fund and one of Playboy’s former licensing partners, told The Journal that he would assume the role of CEO.
“It’s a great American company and a great American brand, outside of my personal connection to it,” Hefner told The Wall Street Journal. But it “has been managed to a state of potentially nonexistence.”
Playboy went public in 2021 by combining with a special acquisition company and its stock traded at $50, but it has been steadily losing money — and relevancy — over the years.
The company ended publication of its iconic magazine – which ran its first issue in 1953 – in 2020, citing pandemic-era supply chain disruptions as the reason.
But Playboy has long struggled to find its footing in a rapidly evolving media landscape.
It first lost some of its key demographic in the 1980s to Penthouse and Hustler, magazines which published more explicit photographs.
The Playboy magazine became altogether antiquated with the rise of the Internet, which made pornography readily available.
In 2015, Playboy announced it would stop publishing images of naked women in an attempt to rebrand and carve out a new market for itself, but the move was largely unsuccessful.
The robe-wearing Hugh Hefner died in 2017 at the age of 91. He was survived by his four children, including Cooper, all of whom sold their stakes in the company.
Cooper Hefner has lamented the decline of the company, blaming its descent into obsolescence on mismanagement.
“It’s Playboy entering businesses that they’ve never operated before,” he told the Journal.
He said the products are “not resonating at all with consumers or customers or fans.”
“And the business’s decline and the brand’s relevance – in terms of being hardly spoken about today – is a direct reflection of that.”