Vice Media, once a high-flying media startup valued at nearly $6bn, has filed for bankruptcy protection in the US. The digital publisher, which operates assets such as Vice News, Motherboard, Refinery29, and Vice TV, has agreed to a cut-price sale to a group of lenders that includes Fortress Investment Group, Soros Fund Management, and Monroe Capital. The sale, set to conclude in two to three months, comes after years of financial difficulties and executive turmoil at the company.
Under the deal, which also has a provision that Vice could still be sold to a third party if a higher bid emerges, the lenders are also providing more than $20m and other financings to fund Vice throughout the sale process. Vice expects to “emerge as a financially healthy and stronger company” when the process concludes.
Bruce Dixon and Hozefa Lokhandwala, co-chief executive officers at Vice, said, “This accelerated court-supervised sale process will strengthen the company and position Vice for long-term growth. We will have new ownership, a simplified capital structure, and the ability to operate without the legacy liabilities that have been burdening our business.”
Vice, which began as a punk magazine in Montreal almost three decades ago, expanded into digital media and TV by striking deals with firms including Sky and HBO. The company, which was once valued at $5.7 billion in 2017, has seen its fortunes decline as digital publishers faced an increasingly difficult market.
The bankruptcy filing will give the company some relief from its onerous debt load as its lenders, including Fortress, seek to salvage their investments. Vice Media raised a $250 million loan from Fortress and Soros Fund Management in 2019 as it struggled to make a profit. It has been in default on that loan for months.
Vice Media’s decline underscores the challenges faced by digital media companies, such as BuzzFeed and Vox Media, which bet big on the rising power of social media networks like Facebook and Instagram but struggled to generate profits from their vast audiences. The future of digital publishing remains uncertain as industry players continue to grapple with the shifting landscape and financial challenges.