Playboy Up, Iconix Down on Rumors of Sale

CHICAGO—After rumors began swirling that Playboy Entertainment Group is in talks with New York-based Iconix Brand Group about a possible sale, shares of the latter started falling while shares of the former started surging.

Shares of Iconix were down 3.5 percent at $11.72 in Thursday afternoon trading, after having fallen 5.4 percent earlier in the session. Meanwhile, shares of Chicago-based Playboy surged Thursday; shares were up 34 percent at $3.82 in midday trading, a 96-cent gain. At one point the stock touched $4.75, a jump of nearly 70 percent, reported Crains.

The venerable lifestyle brand has had its well-publicized share of woes over the past few years, as advertising rates have fallen and it has struggled to make up the difference in its internet, cable and satellite divisions. While its licensing division has continued to see positive results, the market value of the company had sunk to around $100 million as of Thursday.

Iconix owns a portfolio of brands that includes Danskin, Fieldcrest, London Fog and Candies, among others. According to Bloomberg, Iconix Chairman and CEO Neil Cole, who is known for resurrecting “lost” brands, is looking to add to his portfolio, and has a kitty of $200 million to $300 million available for acquisitions.  

Talks have been private and neither side has commented, but a person close to the situation said that a deal may not be forthcoming. Iconix is one of a couple of companies that reportedly have expressed at least a nominal interest in Playboy, and unnamed sources tell AVN that offers on or near the table are running in the $300 million range.