Vice is preparing bankruptcy filing, says newspaper – 05/01/2023 – Market

Digital media company Vice, which attracted the likes of Disney and Fox as investors before it hit the ground running, is preparing to file for bankruptcy, according to two people with knowledge of the operations.

Filing could happen in the coming weeks, according to three people involved with the matter who were not authorized to discuss the potential bankruptcy publicly.

The company has been looking for a buyer, and may yet find one, to avoid declaring bankruptcy. More than five companies have expressed interest in acquiring Vice, according to one involved in the discussions. The chances of that happening, however, are getting smaller and smaller, said one of the people with knowledge of the potential bankruptcy.

A bankruptcy filing would be another dark step in the tumultuous history of Vice, a so-called “new-media” vehicle that sought to outdo the establishment before persuading it to invest hundreds of millions of dollars. In 2017, after an investment round from private equity firm TPG, Vice was valued at $5.7 billion. But today, by most projections, it’s worth a fraction of that.

In the event of a bankruptcy, Vice’s biggest creditor, Fortress Investment Group, could end up controlling the company, said one of those involved in the transaction. Vice would continue to operate as normal and would hold an auction to sell the company within 45 days, with Fortress as the most likely buyer.

Unlike Vice’s other investors, which have included Disney and Fox, Fortress has a type of credit that guarantees that it will be paid in advance if the company is sold.

“The Vice Media Group is engaged in a comprehensive assessment of alternative strategies and planning,” the organization said in a statement on Monday (1st). “The company, its management and stakeholders remain focused on finding the best path for the company.”

Vice started out as a punk magazine in Montreal, Canada over two decades ago. Over the years, it has grown into a global media company with a movie studio, an advertising agency, an HBO show and offices in world capitals. Disney, after investing hundreds of millions in Vice, explored the possibility of buying the company in 2015 for more than $3 billion, according to two people involved in the talks.

The deal never materialized, and Vice eventually succumbed to a bear market for digital media companies. The company has been trying for years to become profitable, but failing to do so, losing money and repeatedly laying off employees.

Last week, Vice told employees it would shut down Vice World News, a global news initiative that covered conflict and human rights violations. The shutdown was a cold shower for employees who saw the division’s aggressive coverage as continuing Vice’s roots in gonzo journalism, established when its co-founder Shane Smith reported from risky destinations like North Korea.

While looking for a buyer in recent months, Vice has seen calls for layoffs in its leadership positions. Nancy Dubuc, the company’s former CEO, left this year after nearly five years at the company. Jesse Angelo, the president of global news and entertainment, also left Vice.