Hugh Hefner and his girlfriend, British-American model and singer Crystal Harris, at the Palms Casino Resort in Las Vegas. (Reuters)

New York, Jan. 10 (Reuters): Hugh Hefner, whose Playboy magazine first exposed many Americans to the possibilities of sexual freedom during the buttoned-up 1950s, is taking the bunny private.

Playboy Enterprises Inc, the publisher known for its bunny ears and nude centerfolds, plans to go private in a deal that values the company at $207 million. The owner of Penthouse magazine earlier offered a higher bid.

Shares of Playboy jumped almost 17 per cent in early morning trading today.

Hefner, 84, founded Playboy with $600 in 1953 when he published the first edition of Playboy magazine, featuring a partially nude photograph of Marilyn Monroe. Playboy has been publicly traded since 1971, and its investors, including Hefner, have seen the company’s stock price fall in recent years as people turn from magazines to the Internet for free pictures of naked women and pornography.

The company has been changing its business to focus more on licensing the popular “Bunny Ears” logo, a white silhouette of a rabbit head with prominent ears and a bow tie.

“I think any turnaround is easier managed from a private perspective when you don't have shareholders focusing on a quarter-to-quarter basis,” said RBC Capital Markets analyst David Bank.

Chief executive Scott Flanders will remain at the company and keep a “significant equity investment” in Playboy, the company said today.

Icon Acquisition Holdings LP, which Hefner controls, plans to buy Playboy’s shares along with Rizvi Traverse Management LLC. Playboy has about $115 million in debt.

Hefner owns about 70 per cent of Playboy’s Class A common stock and 28 per cent of its Class B stock. He and another large shareholder, Plainfield Asset Management, plan to transfer their shares in the deal.

Icon is offering shareholders $6.15 per share, higher than an earlier offer and a premium of about 18 per cent to Friday’s closing price.