Vice Media on Monday morning announced that it has filed for bankruptcy protection. The company has closed a deal with a consortium of its lenders to purchase the company. The announcement confirms reports from earlier this month.
The alternative media company, which once touted a valuation of as much as $5.7 billion, listed assets and liabilities between $500 million to as much as $1 billion in a Chapter 11 petition filed in the U.S. Bankruptcy Court of the Southern District of New York.
In a press release, it announced that it has agreed to the terms of an asset purchase agreement with creditors — including Fortress Investment Group, Soros Fund Management, and Monroe Capital. The consortium will purchase all of the media company’s assets for about $225 million and assume its significant liabilities. The agreement allows for rivals to bid.
“This accelerated court-supervised sale process will strengthen the Company and position VICE for long-term growth, thereby safeguarding the kind of authentic journalism and content creation that makes VICE such a trusted brand for young people and such a valued partner to brands, agencies and platforms,” said Bruce Dixon and Hozefa Lokhandwala, VICE’s Co-Chief Executive Officers.
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“We will have new ownership, a simplified capital structure and the ability to operate without the legacy liabilities that have been burdening our business. We look forward to completing the sale process in the next two to three months and charting a healthy and successful next chapter at VICE.”
READ: The Rise & Fall of VICE Media: A Cautionary Tale of Bold Journalism
The consortium has also agreed to debtor-in-possession financing, allowing the company to use more than $20 million of cash that constitutes the cash collateral to help fund the business through the sale process.
Vice’s international entities, and the VICE TV joint venture with A&E, are not part of the Chapter 11 filing.
Vice Media’s bankruptcy is the latest in the storm hitting digital media companies as advertisers continue to cut spending and pivot budgets toward social media platforms. Less than a month ago, BuzzFeed shuttered its entire news division. And earlier this month, Paramount did the same to MTV News. Insider, meanwhile, has announced it will cut 10% of jobs.
Information for this story was found via Vice, Fortune, Zero Hedge, and the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
