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After weeks of speculation, Vice Media filed for Chapter 11 bankruptcy protection Monday to smooth a sale of the company.
In a statement, Vice listed both assets and liabilities in the range of more than $500 million to as much as $1 billion in a Chapter 11 petition filed in a New York court. Bloomberg reports that Fortress Credit Corp. ranked among the biggest secured creditors, with claims totaling about $475 million.
The company added that a consortium that includes Fortress, Soros Fund Management and Monroe Capital has agreed to purchase the group for $225 million, including all assets and taking on all liabilities. Vice expects to complete the sale process in the next two to three months.
In the face of a weak advertising market and a turbulent economy, Vice, like fellow digital media darlings BuzzFeed and Vox Media, has struggled to manage costs and grow revenues.
Filing for bankruptcy is an epic fall from grace for a company that was once one of the hottest media brands around, and boasted investment from the likes of traditional media powerhouses Fox Corp. and Disney.
Founded as a print magazine in Montreal in 1994 by Shane Smith, Suroosh Alvi and Gavin McInnes, Vice made its mark with gonzo journalism, dark travel stories, ironic humor and photography from the likes of the now-disgraced Terry Richardson to become synonymous with late 90s early aughts’ hipster culture. The company relocated to New York in 1999, and expanded greatly, becoming more digital-focused and adding film and TV units. Vice then experienced a run of success and cultural influence that reached its zenith when private equity giant TPG Capital invested $450 million in the company to give it an incredible $5.7 billion valuation.
With Vice riding market sentiment and a seemingly unshakable sense of cool, Smith even touted an IPO in June 2017.
But things started going wrong for the Brooklyn-based company later in 2017 as a series of internal problems and outside factors began to chip away at its aura of success. In late 2017, Vice became embroiled in several MeToo scandals, amid allegations of sexual harassment and pay inequity that saw top executives exit. Smith stepped down as CEO in 2018, to be replaced by veteran media and TV executive Nancy Dubuc who sought to professionalize and grow the media company.
This year has proved to be another annus horribilis for Vice, with Dubuc stepping down as CEO in February and Jesse Angelo, Vice’s global president of news and entertainment, exiting in March. In April, Vice shuttered its flagship TV news show Vice News Tonight and laid off more than 100 staff. Earlier this month, the company instituted widespread layoffs at its Vice World News division, closing its APAC offices.
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