Latham & Watkins Advises Playboy on US$122 Million Sale of 50% of China Licensing Business to United Trademark Group

Playboy, Inc. (NASDAQ: PLBY) (Playboy), a global apparel and lifestyle company, announced that it has entered into definitive agreements to sell 50% of its China business to UTG Brands Management Group (UTG), an experienced consumer brands operator in China. Upon closing, UTG will manage all operational aspects of Playboy’s business activities in China, Hong Kong, and Macau. Under the terms of the agreements, Playboy will receive US$122 million in total cash, including US$45 million payable over two years in exchange for UTG’s acquisition of a 50% interest in the joint venture for Playboy’s China business, US$67 million in guaranteed minimum distribution payments over eight years, and US$10 million in brand support payments over the next three years. In addition to the annual guaranteed minimum distribution payments to Playboy, which will equal or exceed its current net cash flows from China, Playboy expects to receive incremental annual distributions from its remaining ownership in the joint venture as UTG grows the business. UTG has paid a US$9 million deposit against the purchase price, and the initial closing of the transaction is expected to occur by March 31, 2026, subject to customary closing conditions.

Latham & Watkins LLP represents Playboy in the transaction with a Los Angeles–based corporate deal team led by partners Steven Stokdyk and Brian Duff, with associates Shayna Servillas and Irena Huang. Advice was also provided on intellectual property matters by associate Nick Goshgarian, and on finance matters by partner Mark Morris and counsel Jonathan Shih, with associate Alexis Frese.