The troubled Vice Media Group filed for Chapter 11 bankruptcy protection on Monday, after years of financial and managerial difficulties.
In a filing with the Southern District of New York (pdf), the Brooklyn-based media company said it has agreed to sell its assets to a consortium of investors that had previously lent it money.
The lender consortium, which includes Fortress Investment Group, Soros Fund Management, and Monroe Capital, have offered $225 million for all of the company’s assets—and all of its “significant liabilities”—in the court-supervised sale process.
The consortium is also providing Vice with more than $20 million in cash, as well as some other financing necessary to keep the company afloat throughout the sales process, which is expected to conclude in two to three months.
Under the deal, Vice could still be sold to a third party if a third party should place a higher bid.
In its bankruptcy filing, Vice estimated both its assets and liabilities to be in the range of $500 million to $1 billion, with an estimated 5,000 to 10,000 creditors.
At its peak, just six years ago, Vice was valued at $5.7 billion.
Vice began as a Canadian punk magazine in 1994. It was founded by Shane Smith, Suroosh Alvi, and Gavin McInnes—who later founded the right-wing group the Proud Boys.
With a focus on millennial audiences, Vice grew fast, and soon became a major media player. In the 2010s, the company attracted numerous large investments, including from media giants like Disney and 21st Century Fox, and struck deals with Sky and HBO.
In 2018, A+E Networks veteran Nancy Dubuc took over as CEO of the company after the departure of Smith from the role amid complaints of sexual harassment at the company.
Dubuc laid off 10 percent of staff, but failed to grow the company’s revenue—despite the $400 million acquisition of Refinery29 in 2019.
That same year, more layoffs followed in the wake of managerial disagreements and leadership changes. A consortium of private investors—including those who have now made a bid on the company—lent Vice a total of $250 million.
In 2021, James Murdoch’s Lupa Systems invested another $85 million in the company. In February of this year, Fortress Investment Group loaned Vice another $30 million to allow it to pay overdue bills to vendors.
The same month, Dubuc announced her departure.
In April, Vice said it was cutting its flagship news broadcast program “VICE News Tonight” in “response to the current market conditions and business realities facing VMG and the broader news and media industry,” co-CEOs Bruce Dixon and Hozefa Lokhandwala said.
Vice’s bankruptcy filing comes amid a challenging period for many technology and media companies, with several resorting to downsizing in recent months due to a turbulent economy and a weak advertising market.
Reuters contributed to this article.
