Penthouse Magazine Parent Company Files For Chapter 11
FriendFinder Network reportedly unable to keep up with a mountain of debt.
Three years after offering a reported $210 million for Playboy, Penthouse's parent company has filed for Chapter 11. The FriendFinder Network owns and operates 36 digital properties in addition to publishing Penthouse, however it appears the company expanded too quickly in recent years.
The late Bob Guccione founded Penthouse magazine in 1965 as an antidote to the success of Playboy. The magazine had a number of ups and downs since it was founded-including a 2003 bankruptcy that inspired Guccione to step down as CEO of parent company, General Media, in 2004.
In 2007, the reformed Penthouse Media Group purchased the assets of Various, Inc. for $500 million. Various owned and operated several online dating sites, including AdultFriendFinder.com. The corporation became FriendFinder Networks soon after the merger.
In 2009 and 2010 FriendFinder Networks was ranked as one of Inc.'s fastest growing companies, swelling by nearly 1000 percent in a four-year span. And in 2010 it was reported the corporation secured upwards of $551 million in an effort to roll out its IPO.
Times have not been good since, however. Its 36 sites have not been profitable, despite massive investments and marketing efforts. Even worse, the corporation reportedly has somewhere between $500 million to $1 billion in liabilities with only $10 million in assets behind it.
FriendFinder Networks generated $293.7 million over four consecutive quarters ending June 30 2013 and its NasdaqGM (FFN) 52-week range has been a volatile .18-1.00.
Representatives from the corporation and Penthouse could not be reached for comment, so it is uncertain what the magazine's future is. However, the Penthouse brand carries a circulation of 109,000, a TV division, an e-commerce site and 10 live-entertainment clubs around the world.