The internet company, once valued at $5.7 billion, is seeking bankruptcy protection after it struggled to find a buyer.
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Vice Media has filed for bankruptcy protection, becoming the latest digital media company to reel from its meteoric rise.
On Monday, Vice said it had agreed to sell its assets to a consortium of lenders – Fortress Investment Group, Soros Fund Management and Monroe Capital – in exchange for a $225 million loan. Other parties will also be able to submit bids.
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The Chapter 11 bankruptcy filing came weeks after the company announced it was canceling its flagship Vice News Tonight program and laying off employees. More than 100 out of 1,500 employees are expected to be laid off, reports The Wall Street Journal. The company also stated that it would stop using the Vice World News brand, making Vice News its only brand in the world.
Bankruptcies registered under Chapter 11 of the United States Bankruptcy Code are designed to protect a debtor company from its creditors in order to facilitate its sale or reorganization into a profitable enterprise.
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Monday’s announcement comes amid a wave of layoffs and media shutdowns, including job cuts at the Gannett newspaper and publishing chain, National Public Radio and The Washington Post. In April, BuzzFeed announced it was shutting down its Pulitzer Prize-winning digital media outlet BuzzFeed News as part of a parent company cost-cutting program.
VICE Media LLC filed for Chapter 11 bankruptcy, a process that could result in the sale of the company. https://t.co/C4Wvwai1zn
— VICE News (@VICENews) May 15, 2023
The current uncertain economic climate and the sharp drop in digital advertising sales have also hurt the profitability of big tech companies, from Google to Facebook.
The roots of Vice Media date back to 1994 when the original punk magazine Vice was launched in Montreal. Vice soon moved to New York and grew into a global media company.
Over the years, Vice has developed a reputation for candid journalism that has covered bold stories around the world. The media company’s assets also include film and television production, its own marketing agency, and brands such as Refinery 29 and Unbothered.
In recent years, the media company has struggled to recoup profits. Faced with a financial crisis, Vice received $30 million in debt financing from Fortress Investment Group in February, according to The Wall Street Journal.
Vice was valued at $5.7 billion in 2017. Experts estimate that the company is now worth only a fraction of that amount, The New York Times reported this month.
Co-CEOs Bruce Dixon and Josef Lokhandwala said the sale process will strengthen the company and ensure its long-term growth, “thereby preserving the authenticity of the journalism and content creation that makes VICE such a trusted brand for young people and such a valuable brand.” partner of brands, agencies and platforms.”
