| Tue, Jun 02, 2009 |
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Playboy Confirms New CEO; Compensation Includes $875K Base
Playboy Enterprises (NYSE: PLA) has a new head, officially, after six months of searching: Scott Flanders, till now the CEO of local newspaper and TV chain Freedom Communications, has been named the CEO officially today, after news came out in WSJ yesterday. Christie Hefner, the daughter of Playboy founder Hugh Hefner, resigned in December last year, after 20 years at the company. Prior to joining Freedom in Jan 2006, he was CEO of Columbia House, the subscription music and DVD business which was sold to a unit of Bertelsmann AG in 2005.
Flanders will starts at Playboy July 1, and has a tough challenge ahead to reposition the company storied brand, try and rescue the print magazine, reassess its brand extension into other related ventures (nightclubs), and develop more robust digital offerings than it has today. This new appointment may put to rest any imminent change of hands for the company, though his previous experience suggests he has been a good turnaround-and-exit manager; rumors of it being on the block and interested bidders have been circulating for a few months now. In an interview with WSJ, he said that he will be focused “chiefly on building shareholder value by tapping the potential of the iconic bunny-head brand,” which could really mean anything. Also, Playboy has appointed David Chemerow, SVP and CFO of Olympus Media, as nonexecutive chairman. More details in release.
Meanwhile, following some controversy over former CEO Hefner’s severance package, some numbers about Flanders’ new compensation package have come out an SEC filing. His base salary of $875K is the same that Hefner got in her role as CEO last year: —his term is for four years, starting July 1, with 30 day termination notice for anything besides cause, subject to certain severance and other payment obligations.—Flanders will receive an annual base salary of $875,000, which will increase by $25,000 each year, and will be eligible for a one-time performance-based bonus at the end of calendar 2009 at a target amount of 75 percent of his base salary and a maximum of 100 percent. Any such bonus will be at the discretion of the board.—For 2010 and each subsequent year, Flanders will be eligible to participate in an incentive compensation plan at a target amount of 75 percent of his base salary and a maximum of 100 percent. —He will also receive a one-time grant of 150,000 restricted stock units of the Company’s Class B common stock and options to purchase 1,200,000 shares of Class B common stock. The restricted stock units and stock options will both vest over a period of four years, subject to accelerated vesting in the event of a change in control. Which is likely to happen way before that…—Flanders shall be subject to non-compete and non-solicitation provisions for the term of his employment with the company and one year thereafter.
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paidContent.org
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Playboy Confirms New CEO; Compensation Includes $875K Base
Playboy Enterprises (NYSE: PLA) has a new head, officially, after six months of searching: Scott Flanders, till now the CEO of local newspaper and TV chain Freedom Communications, has been named the CEO officially today, after news came out in WSJ yesterday. Christie Hefner, the daughter of Playboy founder Hugh Hefner, resigned in December last year, after 20 years at the company. Prior to joining Freedom in Jan 2006, he was CEO of Columbia House, the subscription music and DVD business which was sold to a unit of Bertelsmann AG in 2005.
Flanders will starts at Playboy July 1, and has a tough challenge ahead to reposition the company storied brand, try and rescue the print magazine, reassess its brand extension into other related ventures (nightclubs), and develop more robust digital offerings than it has today. This new appointment may put to rest any imminent change of hands for the company, though his previous experience suggests he has been a good turnaround-and-exit manager; rumors of it being on the block and interested bidders have been circulating for a few months now. In an interview with WSJ, he said that he will be focused “chiefly on building shareholder value by tapping the potential of the iconic bunny-head brand,” which could really mean anything. Also, Playboy has appointed David Chemerow, SVP and CFO of Olympus Media, as nonexecutive chairman. More details in release.
Meanwhile, following some controversy over former CEO Hefner’s severance package, some numbers about Flanders’ new compensation package have come out an SEC filing. His base salary of $875K is the same that Hefner got in her role as CEO last year: —his term is for four years, starting July 1, with 30 day termination notice for anything besides cause, subject to certain severance and other payment obligations.—Flanders will receive an annual base salary of $875,000, which will increase by $25,000 each year, and will be eligible for a one-time performance-based bonus at the end of calendar 2009 at a target amount of 75 percent of his base salary and a maximum of 100 percent. Any such bonus will be at the discretion of the board.—For 2010 and each subsequent year, Flanders will be eligible to participate in an incentive compensation plan at a target amount of 75 percent of his base salary and a maximum of 100 percent. —He will also receive a one-time grant of 150,000 restricted stock units of the Company’s Class B common stock and options to purchase 1,200,000 shares of Class B common stock. The restricted stock units and stock options will both vest over a period of four years, subject to accelerated vesting in the event of a change in control. Which is likely to happen way before that…—Flanders shall be subject to non-compete and non-solicitation provisions for the term of his employment with the company and one year thereafter.
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paidContent.org
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| Mon, Jun 01, 2009 |
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Playboy Set To Offer CEO Post To Freedom Communications’ Flanders
After nearly six months of looking for a permanent replacement for Christie Hefner, Playboy Enterprises (NYSE: PLA) is set to formally offer the CEO post to Freedom Communications’ head Scott Flanders, WSJ reported, citing unidentified sources. The deal is not yet finalized and WSJ cautioned that it could fall apart.
Last week, Virgin Group’s Richard Branson’s name was bruited about as a possible buyer of Playboy, which has been reportedly looking for opening bids of $300 million. Branson quickly moved to dispel those rumors and said he had no interest in a acquiring the adult-themed media company.
If Flanders is brought on as CEO, aside from trying to engineer a turnaround—Q1 net loss was $13.7 million as revenue fell 22 percent, for example—generating an attractive offer from a credible buyer will be his primary focus. And Flanders’ experience has shown that he knows how to handle the sell-off of a company that did better in a bygone era. More after the jump
—Experience helps: Flanders has spent the past three years as president of Freedom, an owner of local TV stations and newspapers. As a sign that Flanders knows something about handling brands that have seemingly been passed by time, he was tapped to serve as chairman and CEO of the Columbia House Company, the discount music retailer, in 1999. At the time, he was brought on to take over the entity that would be created through the combination online retailer CDNow and Columbia House. In March 2000, Flanders convinced Columbia House to cancel the deal, feeling that the merger somehow wasn’t right. With that deal dead, *AOL* Time Warner (NYSE: TWX) and *Sony* Corporation, then 50/50 joint owners of Columbia House, looked to Flanders to concentrate on fixing what was left of Columbia House. Flanders’ company bio clams he ultimately returned the company to profitability and at the direction of the board, he negotiated a leveraged buyout of the company by The Blackstone Group in June 2002. Based on that history, speculation is that Flanders could contrive a similar outcome for Playboy.
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paidContent.org
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| Thu, May 28, 2009 |
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Virgin Denies Interest In Playboy
Richard Branson is throwing cold water on the word that Virgin Group was considering a bid for Playboy Enterprises (NYSE: PLA). A spokesperson for Virgin emailed Reuters to say that “Reports that Virgin Group is looking to buy Playboy Enterprises ... are untrue.” As for Playboy, the company has been continuing to say that it is willing to listen to offers, but will not confirm whether it is asking for $300 million.
Over the past few months, as the company has sought to cut costs and its market cap has shrunk to $100 million, it has had a series of layoffs and closed its New York office. And while it has gotten some credit for its digital revamp earlier this year, so far, that has not turned turned the company’s web business around. Investors have been anxious for some time, with many feeling the company has been “under-valued and under-managed.” The search for a new CEO has also been slow, which interim head Jerry Kern still holding the post since the exit of Christie Hefner back in December. The Virgin rumor did give the company’s stock a little boost, sending shares up to $3.12 after having been been hovering around $1.15 two months ago. Playboy was still up as the trading day closed, gaining 4.82 percent to end at $3.26.
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paidContent.org
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| Wed, May 27, 2009 |
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Virgin Looking At Playboy—But Will Branson Buy?
While a number of PE firms have reportedly balked at Playboy (NYSE: PLA) Enterprises’ $300 million asking price, actual billionaire playboy Richard Branson’s name has been increasingly mentioned as a prospective buyer. The Chicago Tribune, picking up a piece from the UK’s Daily Mail, says the Virgin Group chairman could be interested in making a play for the adult-themed media company. Both Playboy and Virgin have said no comment, but the rumors have sent Playboy’s stock up to $3.12 today after shares had been been hovering around $1.15 two months ago.
It’s hard to say whether Branson is the person to turn it around, but Playboy did thrive under another out-sized personality of Hugh Hefner. While the 83-year-old Hefner still owns a majority stake and serves as chief creative officer, he stepped back long ago from the day-to-day running of the company, which currently has a market cap of $100 million. Playboy had been banking on a major digital revamp, which was completed last January, but it clearly made little positive difference in Q1, when digital revenue fell 39 percent—though to be fair, Playboy said the move to outsource e-commerce was part of the reason for huge decline.
In the meantime, while the speculation is rampant about who if anyone will buy the company, it certainly has distracted observers from wondering who or when Playboy will choose to permanently replace Christie Hefner, who left the company and handed the role of Chairman and CEO to Jerry Kern in December on an interim basis.
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