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Playboy Enterprises Inc. is exploring a sale, according to people familiar with the situation, a move that comes soon after the storied magazine publisher ditched nude photos and launched a revamp for the digital age.

Investment bank Moelis & Co. is advising Playboy, which Hugh Hefner, the company’s founder, took private in 2011 alongside private-equity firm Rizvi Traverse Management. Mr. Hefner owns a roughly one-third stake in the company, the people said.

Playboy doesn’t disclose detailed financials. In 2015, the company generated $38 million from media, including the magazine and digital publishing initiatives, and $55 million from licensing out its brand to other companies, according to a document reviewed by The Wall Street Journal. The licensing business could be worth hundreds of millions of dollars, the people familiar with the matter said.

Playboy could fetch north of $500 million, and potential buyers could include companies that would license the brand for use in consumer goods, new media outfits and trophy buyers, the people said. The 2011 deal that took Playboy private valued it at $207 million.

The company owns other assets such as the 5-acre Playboy Mansion, a sprawling Los Angeles home that it recently put up for sale. As Playboy shopped the mansion, bidders for the whole company emerged, prompting Playboy to enlist Moelis to consider an all-out sale on a separate track, the people said.

Moelis is expected to run an auction for Playboy. It is possible the company will choose to sell itself in pieces or not sell at all and stay on its current course.

For six decades, Playboy helped shape the American discourse on sex, but in the past several years it has been fighting to maintain that pre-eminent cultural status amid sliding magazine sales and a digital landscape that makes adult material widely available. The magazine has a circulation of about 800,000, down from its peak of 5.6 million in 1975, according to Alliance for Audited Media.

Over the past few years, Playboy Chief Executive Scott Flanders has tightened the company’s belt and shrunk head count after taking over as the company’s top executive in 2009 for Christie Hefner, Mr. Hefner’s daughter.

The company has endeavored to attract a younger audience as its long-standing brand of hedonism, with “bunnies” and “playmates,” became increasingly outmoded.

The cover of the March 2016 issue, the first print edition to eschew nudity, was a visual ode to the mobile app Snapchat, designed to look like one of the service’s disappearing messages. Mr. Hefner’s 24-year-old son, Cooper, criticized the move to remove nudity from the publication as well as the decision to sell the mansion and said his role in the company had diminished due to a difference of vision with the board.

“Millennials and Gen-Y didn’t view nudity as the issue,” he told Business Insider in February. “The issue was the way in which the nudity and the girls were portrayed.”

In August 2014, Playboy stopped publishing nudity on its website. The company has said the change helped drop the average user age from 47 to 30.

In 1953, Marilyn Monroe appeared on the first cover of Playboy, and the magazine would go on attain totemic status in popular culture and feature stars such as Farrah Fawcett, Sharon Stone and Madonna.

For those who, as the long-running joke goes, bought the magazine for the articles, Playboy published the work of John Updike, Joyce Carol Oates and Kurt Vonnegut, and ran interviews with luminaries like Martin Luther King, Jr., John Lennon and Steve Jobs.

As the Playboy bunny-head logo became more recognizable and gained international appeal, the company extended beyond the magazine into a successful licensing business and a television operation that it later sold to Internet porn company Manwin.

[wsj]

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