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Playboy Will Spin Off Online Unit in $50 Million IPO

Media empire looking to unlock unit's value.

, the online arm of the



media empire, filed Monday for a $50 million initial public offering.

A company spokeswoman declined to say how many shares would be sold or what portion Playboy will retain. Analysts said both the parent and the online unit would benefit from a spinoff, which would unlock value for Playboy shareholders.

Playboy shares gained 2 3/4, or 12%, to 26 1/8 on the news. They're off a 52-week high of 36 1/8.

"There's very little valuation of in Playboy," said Dennis McAlpine, analyst for

Ryan Beck Southeast Research

. He rates the stock a buy (

Credit Suisse First Boston

is leading the underwriting, with co-managers

Bear Stearns

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Banc of America Securities

.) "Spinning it out will force a valuation."

In a report last month anticipating the move, the brokerage house

Ladenburg Thalman

valued the online assets between $557 million and $1.1 billion, or $22 to $43 per Playboy share.

Of that, the firm said, only $150 million is reflected in Playboy's stock price.

The online business includes, which carries feature articles and advertising, the Playboy Store, which sells the company's brand-name products, and Playboy Cyber Club, a subscription site featuring, well, "premium Playboy content."

The company also began its own auction site last month, christened with bidding on tickets for two (for two!) to the New Year's Eve bash at the Playboy mansion.

Playboy will need to find a chief executive soon, analysts said.

Christie Hefner

has been the acting executive for three months, and the company began searching only a month ago for a permanent chief executive, analysts said.

Credit Suisse representatives wouldn't say when the offering will be priced.