By Joshua Franklin and Mike Spector
Sept 18 (Reuters) - Playboy magazine owner Playboy Enterprises is exploring options that include going public through a merger with a blank-check acquisition company, according to people familiar with the matter.
A deal with a blank-check firm - referred to on Wall Street as a special purpose acquisition company (SPAC) - could result in Playboy's return to the stock market, nine years after it went private in a $207 million deal led by its late founder Hugh Hefner and private equity firm Rizvi Traverse Management.
Since then, the company's print sales have fallen further. The COVID-19 pandemic compounded its challenges, leading Playboy earlier this year to stop printing the magazine, ending a nearly seven-decade run on newstands that began in 1953 with a debut issue featuring Marilyn Monroe.
Playboy is working with an investment bank to engage in discussions with a potential SPAC buyer, the sources said. A deal, if one is reached, would give Playboy access to money it needs to finance growth initiatives that it otherwise might not be able to tap, one of the sources said. The sources spoke on condition of anonymity because the talks are confidential.
The sources cautioned that it is possible no deal will materialize. Playboy Chief Executive Ben Kohn and Rizvi Traverse Chief Investment Officer Suhail Rizvi did not immediately respond to requests for comment.
Hefner, who founded Playboy in 1953, died in 2017 at the age of 91. His family sold a 35% stake in Playboy to Rizvi Traverse for $35 million in 2018, according to PitchBook data.
The company had explored a sale in 2016, Reuters reported at the time.
Playboy magazine's rabbit silhouette became one of the best known logos in the world and the "bunny" waitresses in Hefner's Playboy nightclubs were instantly recognizable in their low-cut bathing suit-style uniforms with bow ties, puffy cotton tails and pert rabbit ears.
In recent years, Playboy has expanded beyond its media business to refashion itself as a lifestyle brand. It has also licensed its brand and logo to others. Playboy did away with full frontal nudity starting in its March 2016 issue, but reversed course a year later.
A SPAC is a shell company which raises funds in an initial public offering (IPO) with the goal of acquiring a private company. The acquired company then becomes publicly traded as a result. Such vehicles have emerged in 2020 as an increasingly popular route to the public markets over a traditional IPO.
Many of the most successful SPAC acquisitions this year have been for high-profile consumer brands, such as Diamond Eagle Acquisition Corp's purchase of sports betting platform DraftKings Inc DKNG.O, or for companies in emerging industries like electric vehicles and plant-based food.
(Reporting by Joshua Franklin in Boston and Mike Spector in New York Additional reporting by Anirban Sen in Bangalore; Editing by Tom Brown)
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