CHICAGO — According to the Wall Street Journal, Playboy Enterprises is set to offer its CEO position to Freedom Communications’ head Scott Flanders.
Along with attempting to orchestrate a financial turnaround for the rabbit, Flanders’ objective would be to court an attractive offer form a credible buyer. Word that Playboy was on the market for $300 million was made public last month by The New York Post.
Virgin Group owner Richard Branson was reported to be eyeballing Playboy last week, but has since denied interest in purchasing the company.
Playboy declined to comment, as has Flanders’ company Freedom, based in Irvine, Calif. For more than three years, Flanders has headed up Freedom, which owns TV stations and newspapers, including the Orange County Register. Also, he was an independent director for Playboy a few years ago while Freedom was fighting off takeover offers. Flanders is credited with negotiating a leveraged buyout for Columbia House Company by The Blackstone Group in June 2002.
The Journal reports no contract has been signed so it's not a done deal, but did add that Flanders recently paid several visits to the Playboy Mansion in Los Angeles and is the top contender to replace interim CEO Jerome Kern.
"After reports early last week that the publisher had approached private-equity firms about a possible sale, Playboy said it isn't marketing itself to investors but is willing to hear proposals," the Journal reports. "It isn't clear whether the emergence of Mr. Flanders as a favorite means the company is more likely or less likely to seek a buyer."
Some Wall Street experts believe hiring a permanent CEO could continue to push the company's stock price higher and that stock took a jump last week just from rumors of an imminent sale. But other financial analysts also suggest Flanders’ appointment could mean there will be no sale and stock prices may stall, suggests the Chicago Sun-Times.
Playboy declined to comment, as has Flanders’ company Freedom, based in Irvine, Calif. For more than three years, Flanders has headed up Freedom, which owns TV stations and newspapers, including the Orange County Register. Also, he was an independent director for Playboy a few years ago while Freedom was fighting off takeover offers.
Board member Kern stepped as interim CEO following the resignation late last year of Christie Hefner after two decades running the company founded by her father, Hugh Hefner.
Rumors have circulated recently of Playboy's sale. Earlier this year, Kern said the company was "willing to listen" to legitimate offers, though spokespersons denied the company was for sale.
Recently a source told AVN.com three groups were looking at buying Playboy, but so far, any such deals have not surfaced publicly.
Playboy has seen its flagship magazine take a steep decline in revenue over recent years and while the company has seen growth in other entertainment areas and licensing, it still suffered a great fourth-quarter loss and recently made cost-cutting moves that included shutting down its New York offices and centralizing operations in its longtime home base of Chicago.