Vice Media Group is now officially bankrupt.
The company behind Vice and Motherboard has filed for Chapter 11 bankruptcy to engineer its sale to a group of lenders following years of financial difficulties and top-executive departures.
The company had to restructure and downsize its workforce in the past before it ultimately filed for bankruptcy.
Vice Media Group Bankruptcy Details
Vice Media Group filed for Chapter 11 bankruptcy on Monday in the Southern District of New York, possibly due to poor management and warring owners, with it listing assets and liabilities in the range of $500 million to $1 billion, per Business Insider.
Aside from the previously mentioned reasons, Business Insider listed allegations of sexual harassment, layers of debt, ambitious but failed plans to go public, and more than a year of searching for a new owner as reasons that led to its demise.
While the group said it would continue to operate during the bankruptcy process, it is no doubt a deep fall to what it was - it was previously valued at $5.7 billion in 2017.
However, there could be salvation in sight for the group - its filing for Chapter 11 bankruptcy opens it to being taken over by a new owner for $225 million. The group expects to emerge from bankruptcy as a "financially wealthy and stronger company in two to three months."
A CNBC news report stated that if its application for Chapter 11 bankruptcy is approved, other parties could place a bid for the company, allowing them to swap secure debt for company assets rather than pay cash. Currently, the lender consortium, which includes Fortress Investment Group, Soros Fund Management, and Monroe Capital, will provide about $225 million as a credit bid for substantially all of Vice Media Group's assets and also assume significant liabilities at closing.
The group did what it could to stave off such a result. Its restructuring and job layoffs in late April 2023 sealed the fate of "Vice News Tonight," its flagship news show on cable channel Vice TV, and the jobs of more than 100 workers, per Deadline. Unfortunately, this move didn't solve or delay the inevitable, resulting in its filing for bankruptcy.
Currently, Vice's multi-platform media brands, such as (but not limited to) Vice News, Pulse Films, Virtue, Refinery239, and i-D, will continue to run despite Vice Media Group's bankruptcy filing.
Vice Media Group's History
Vice Media was first launched in 1994 as a fringe magazine called "Voice of Montreal" by Shane Smith, Gavin McInnes, and Surrosh Alvi. It eventually expanded globally through youth-focused content and a prominent social media presence that soon attracted a steady following.
Vice Media Group was once heralded as one of the companies that spearheaded the disruption of the traditional media landscape with its content in various forms, such as print, events, music, online, TV, and feature films.
Unfortunately, the majority of online ad revenues went to tech giants like Google and Meta, making competing with them difficult in the ad market. This difficulty started to create problems for Vice Media that eventually led to the issues it faced before bankruptcy.
