Vice Media, the parent company of the left-wing mainstream online news outlet VICE News, has finally filed for bankruptcy after suffering years of financial difficulties. Its assets will be sold to a group of companies, including George Soros’ private investment firm.
This comes nearly two weeks after reports came out that Vice was considering filing for bankruptcy due to its inability to make enough profits to pay off its debtors. (Related: Parent company of left-wing news site Vice to file for BANKRUPTCY.)
The bankruptcy filing also comes weeks after Vice Media attempted cost-cutting measures to survive in a weaker market, especially for digital media companies that rely on advertising.
Vice Media, whose assets include VICE News, Vice TV, the tech and science-focused online magazine Motherboard and the women-oriented digital media platform Refinery29, agreed to sell all of its assets to a consortium that includes Fortress Investment Group, Monroe Capital and Soros Fund Management (SFM) – the private investment firm of Soros, a Hungarian-American left-wing billionaire.
SFM was founded and is currently chaired by Soros. The firm also acts as the principal asset manager of the Open Society Foundations, a grant-making organization that bankrolls liberal groups worldwide.
Vice reached an agreement to sell its assets to these firms for a paltry sum of $225 million in a credit bid as well as assuming Vice Media’s “significant liabilities.”
Under a credit bid, creditors can pay Vice Media for its assets with their secured debts rather than in cash, meaning that Vice Media won’t even get the full $225 million it was able to bargain for.
Vice Media listed both its assets and liabilities in the range of $500 million to $1 billion. It was hoping for a sale price of $1.5 billion. A significant portion of the company’s international holdings was not part of Vice Media’s bankruptcy filing, and their fate following the conclusion of these proceedings remains unclear.
“Creditors are taking it [Vice Media] over at a steep discount and we will find out whether they can become viable with a much slimmer capital structure coming out of bankruptcy,” said Thomas Hayes, chairman at investment firm Great Hill Capital.
Vice Media to continue operating with smaller budget and workforce at conclusion of deal
In a statement, Vice Media said it “expects to emerge as a financially healthy and stronger company” at the conclusion of the sale and the bankruptcy proceedings.
The conglomerate of investment firms taking over Vice Media will be providing Vice with over $20 million in cash, which the media outlet said will be “more than sufficient” to fund its operations through the sale process.
Vice Media Co-Chief Executive Officers Bruce Dixon and Hozefa Lokhandwala further claimed that, at the conclusion of the sale, what is left of the company will come out stronger and better geared for healthy long-term growth.
“This accelerated court-supervised sale process will strengthen the company and position Vice for long-term growth,” they said in a statement. “We will have new ownership, a simplified capital structure and the ability to operate without the legacy liabilities that have been burdening our business.”
In the late 2000s and early 2010s, Vice was among a group of fast-rising digital media ventures that were able to court millennial and young Gen X audiences, leading to rich valuations.
At its peak in 2017, Vice Media was valued at over $5.7 billion, as it promised to rapidly expand its audience by tapping into the media habits of a global, more internet-savvy youth audience.
This attracted the attention of media giants like Disney and Rupert Murdoch. The former even extended an offer to Vice Media to purchase it for $3 billion in 2015, which was denied. Disney wrote off its $400 million investment in Vice Media as worthless in 2019, following two years of failing to meet growth expectations.
Learn more about left-wing mainstream media outlets at NewsCartels.com.
Watch this clip from “The Talking Hedge” that talks about Hungarian-American left-wing billionaire George Soros’ plans to take over Vice Media.
This video is from the channel The Talking Hedge on Brighteon.com.
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