Vice Media is filing for Chapter 11 bankruptcy protection, the latest digital media company to falter after a meteoric rise, Associated Press (AP), reports.
According to the report by AP, Vice Media said Monday that it has agreed to sell its assets to a consortium of lenders, Fortress Investment Group, Soros Fund Management and Monroe Capital in exchange for $225 million in credit. Other parties will also be able to submit bids.
The bankruptcy filing arrives just weeks after the company announced it would cancel its flagship “Vice News Tonight” program amid a wave of layoffs which was expected to impact more than 100 employees in the company’s 1,500-person workforce, the Wall Street Journal reported. The company also said it would end its Vice Media World News brand, making Vice News its only brand worldwide.
Monday’s filing comes amid a wave of media layoffs and closures, including job cuts at Gannett, NPR, the Washington Post and more over recent months. In April, BuzzFeed Inc. announced that its Pulitzer Prize winning digital media outlet BuzzFeed News was being shut down as part of a cost-cutting drive by its corporate parent.
Digital advertising has plummeted this year, cutting into the profitability of major tech companies from Google to Facebook.
Vice Media’s roots date back to 1994, with the launch of Vice’s original punk magazine in Montreal. Vice soon moved to New York and built itself into a global media company.
Over the years, Vice Media developed a reputation for in-your-face journalism that covered daring stories around the world. The media company’s assets also includes film and TV production, an in-house marketing agency, and brands such as Refinery 29 and Unbothered.
The media company has struggled to turn around profits in recent years. Amid its financial crunch, Vice secured $30 million in debt financing from Fortress Investment Group in February, the Wall Street Journal reported.
In 2017, Vice was valued at $5.7 billion. Now, however, most experts estimate the company is worth just a fraction of that, The New York Times reported earlier this month.
Vice Media co-CEOs Bruce Dixon and Hozefa Lokhandwala said the sale process will strengthen the company and position it 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.”