UNITED STATES: The Vice Media consortium, which owns websites like Vice and Motherboard, has applied for bankruptcy protection to sell the company to a consortium of lenders.
The lender consortium, consisting of Fortress Investment Group, Soros Fund Management, and Monroe Capital, will contribute $225 million in a credit bid for nearly all of the company’s assets and assume a portion of the company’s liabilities at the close.
Creditors can exchange their secured debt for the company’s assets in a credit bid, with a court document showing assets and liabilities ranging from $500 million to $1 billion.
Vice claimed that it had obtained debtor-in-possession finance commitments from the lenders as well as permission to utilise more than $20 million in cash. The company claimed these resources would be “more than sufficient” to fund its operations throughout the selling process.
The bankruptcy filing of Vice is a result of the unstable economy and lacklustre advertising market in recent months. Vice was one of several digital media companies that had enjoyed high values as they wooed millennial fans. Its co-founder, Shane Smith, established his media empire from a single Canadian magazine.
BuzzFeed Inc announced in April that it would be axing the well-liked TV show “Vice News Tonight” as part of a larger reorganisation that would include job losses across the worldwide news division. The news division was known for its witty and in-depth reporting but eventually failed due to the difficulties of its digital-first economic model.
Media firm announced layoffs, and BuzzFeed closed its news division due to financial difficulties and a reduction in advertising revenue. Both companies announced layoffs due to the cancellation of TV programming.
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