New Playboy CEO wants to swing with more partners

SAN FRANCISCO - Playboy Enterprises Inc. hasn't had any luck attracting a buyer, but the slumping adult entertainment company had no trouble attracting its new chief executive.

"It was irresistible," incoming CEO Scott Flanders said in an interview Tuesday. "It's hard to envision a job I wouldn't have left for this opportunity."

Flanders, 52, is defecting from Freedom Communications Inc., a newspaper publisher and television station owner where he has been CEO for the past 3 1/2 years.

He will take the helm at Playboy July 1 under a four-year contract that includes a starting salary of $875,000, with annual raises of $25,000.

Playboy announced Flanders' hiring Monday, filling a void that opened six months ago when Christie Hefner decided to end her 20-year stint as CEO of the company founded by her father, Hugh Hefner, 56 years ago.

The Chicago-based company's interim CEO, Jerome Kern, then indicated Playboy would be willing to listen to buyout offers. But apparently no one was willing to pay a price enticing enough to get a deal done, even with Playboy's current market value hovering around $100 million.

As CEO, Flanders said he will listen to any serious bidders, but stressed he is more interested in attracting business partners to license Playboy's bunny logo and other assets.

Licensing accounted for about 14 percent of Playboy's 2008 revenue of $292 million, which Flanders believes barely taps the potential of a world-famous brand created by the elder Hefner, who remains Playboy's chief creative officer and largest shareholder.

Flanders thinks the 18-month-recession will make it easier to lure new partners because "more companies are more open to new opportunities in times like this."

Still, Flanders knows he will have his hands full as long as the economy is sagging.

Like other owners of print publications and broadcast media, Playboy's revenue has been plummeting as more advertising shifts to the Internet and the recession crunches marketing budgets.

With revenue falling more than 20 percent during the first three months of the year, Playboy suffered a first-quarter loss of $13.7 million. That followed a $156 million setback last year.

Flanders has been dealing with some of the same challenges at Freedom Communications, whose 33 daily newspapers are anchored by The Orange County Register in southern California.

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