NEW YORK - The publisher of Playboy magazine has agreed to accept a sweetened buyout offer from a partnership headed by founder Hugh Hefner, allowing the original playboy to fulfill his plans to take the company private.

Hefner is Playboy's largest shareholder with about 70 percent of Playboy Enterprises Inc.'s voting shares and 28 percent of the nonvoting stock. By leading a buyout for a larger portion, the 84-year-old known for his penchant for silk pajamas and young blond women is betting that the racy magazine he launched in 1953 can still reap profits in the digital age.

It's been a challenge. The printed Playboy has struggled with rivals from the Web and has lost both readers and advertisers. In November, the company reported a wider third quarter loss than a year ago as its revenue fell 7 percent to $52.1 million.

To stem its losses, Playboy's management has been trying to transform the company from a publishing and TV business into a "brand management" company, leaning more on revenue from licensing out the Playboy name and bunny ears for a range of products, such as lingerie, handbags and sunglasses.

"I believe this agreement will give us the resources and flexibility to return Playboy to its unique position and to further expand our business around the world," said Hefner, who serves as the magazine's editor-in-chief and chief creative officer, in a statement. Playboy declined a request to interview Hefner.

Hefner-controlled Icon Acquisition Holdings LP is offering $6.15 a share for Playboy, an 18 percent premium over Friday's closing price. Shares rose 89 cents, or 17 percent, to close at $6.09 on Monday. The stock has traded in the 52-week range of $3.04 and $6.10.

The accepted bid values the Chicago-based company at $207 million and tops Hefner's offer of $5.50 per share in July, though it's just shy of an offer made by a group led by Penthouse magazine that's valued at $210 million.

As part of the deal completed Sunday night, Scott Flanders will remain Playboy CEO and keep what the company called a "significant" equity investment in Playboy, the company said. Icon Acquisitions is paying for the purchase with equity commitments from Rizvi Traverse, a private investment firm, and a debt commitment from Jefferies & Co.

In an e-mail message, Flanders said the deal has several benefits.

"One, we are a small company and a partnership with Rizvi Traverse does for our capital and management structure what AMI and IMG did for our operations," he wrote, referring to Playboy's decision in 2009 to outsource the magazine's business functions, except editorial, to American Media Inc., and its deal with IMG Worldwide Inc. to oversee licensing in Asia and Europe.

It will also eliminate the costs of being a public company and allow Playboy to "take a long-term view and focus on what is best for our businesses and not on the near-term earnings demands of our public shareholders," he added.

Playboy said Monday that a group of board members had been evaluating Hefner's offer and decided to recommend the deal to stockholders Sunday night. A tender offer is expected to begin by Jan. 21 and the deal is expected to close by the end of the first quarter.

Hefner now faces the big task of turning the company around. Playboy's most popular years are well behind it - the magazine enjoyed its heyday in the 1970s. Today it faces competition that ranges from other men's magazines such as Maxim to far racier content available on the Web for free. In recent years, the company has found it difficult to lure readers and advertisers as the Internet supplants print as the top purveyor of adult content. Falling revenue has forced several rounds of layoffs at the company since 2008.

Not surprisingly, it wasn't the paper magazine but Playboy's digital prospects - on the Web and on mobile devices - that had been of interest to Marc Bell, the CEO of Penthouse owner FriendFinder, who said in July the business "needs to be run like a 21st century company."

Representatives FriendFinder did not return a message for comment Monday.