Playboy Enterprises is nearing a deal to go public through a merger with Mountain Crest Acquisition Corp MCAC.O, which would value the owner of Playboy magazine at around $425 million, including debt, people familiar with the matter said.
A tie-up with Mountain Crest would 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.
Mountain Crest, a special purpose acquisition company (SPAC), could announce a deal with Playboy by the end of this month, the sources said on Wednesday, cautioning that talks could still collapse.
Mountain Crest is in discussions with investors who would contribute around $100 million to the deal in the form of a private investment in public equity, or PIPE, transaction, the sources said.
The sources requested anonymity as the discussions are private. A Playboy representative declined to comment. Mountain Crest Chief Executive Suying Liu had no comment when contacted by phone. Executives at Rizvi Traverse did not immediately respond to requests for comment.
Playboy was exploring going public through a SPAC merger. The New York Post reported the exclusive talks with Mountain Crest on Tuesday.
Mountain Crest raised $50 million in an initial public offering earlier this year with the goal of buying a private company, which would then become public as a result of the deal. SPACs have emerged in 2020 as an increasingly popular route to public markets over a traditional IPO.
Playboy earlier this year stopped printing its flagship magazine, ending a nearly seven-decade run on newsstands that began in 1953 with a debut issue featuring Marilyn Monroe.
The company has expanded beyond its media business to refashion itself as a lifestyle brand and is eyeing expansion into sexual wellness.