Vice files for Chapter 11 bankruptcy to facilitate sale

By Al Mayadeen English
Source: News Websites
15 May 2023 16:05

According to a court document, the corporation reported assets and liabilities in the $500 million to $1 billion range.

Vice magazine co-founder Gavin McInnes speaks on stage with members of the Proud Boys organization in Manhattan, New York,on January 20, 2018. (Reuters)

The Vice Media consortium, best known for its websites Vice and Motherboard, filed for bankruptcy on Monday in order to facilitate a sale to a consortium of lenders, following years of financial struggles and top-executive exits.

According to Vice, the lender consortium, which comprises Fortress Investment Group, Soros Fund Management, and Monroe Capital, will contribute around $225 million in the form of a credit bid for nearly all of the company's assets as well as absorb major liabilities after close.

Creditors might use a credit bid to exchange their secured debt for the company's assets rather than paying cash.

According to a court document, the corporation reported assets and liabilities in the $500 million to $1 billion range.

Vice stated that it has obtained commitments from lenders for debtor-in-possession financing as well as approval to utilize more than $20 million in cash, which it claims will be "more than sufficient" to fund its operations during the selling process.

The bankruptcy filing comes at a difficult time for numerous technology and media organizations, which have been forced to downsize in recent months owing to a volatile economy and a sluggish advertising market.

Vice was one of a slew of fast-rising digital media companies that demanded exorbitant values as they courted millennial consumers. It grew in popularity with its co-founder, Shane Smith, who established his media empire with a single Canadian magazine.

The company announced in April that it will eliminate the popular TV show "Vice News Tonight" as part of a larger restructuring that would result in job cutbacks throughout the digital media firm's worldwide news operation.

BuzzFeed Inc. said last month that it will close its news section, which was famed for its humorous coverage but eventually succumbed to the problems of its digital-first economic model.