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Vice Media Group, popular for websites such as Vice and Motherboard, filed for bankruptcy protection on Monday to plan a sale to a group of lenders, resolving financial difficulties and the departure of top executives.
Vice said that the consortium of creditors, which includes Fortress Investment Group, Soros Fund Management and Monroe Capital, will provide about $225 million US in the form of a credit offer for almost all the company’s assets and also assume significant liabilities at the closing.
In a credit bid, the lender can exchange the secured debt, instead of paying cash, for the assets of the company.
The company lists assets and liabilities in the $500 million to $1 billion range, according to court filings.
Representatives said they received commitments for debt financing from lenders, as well as consent to use more than $20 million in cash, which they said would be “more than enough” to finance the business during the sale process.
Final layoff
The bankruptcy filing comes at a challenging time for some tech and media companies, as they have been downgraded in recent months due to a turbulent economy and weak advertising market.
Vice, headquartered in New York City, is among a group of fast-rising digital media ventures that have offered rich valuations as they appeal to millennial audiences. It became famous together with its co-founder, Shane Smith, who built a media empire from a single Canadian magazine in Montreal.
In April, the company said it would cancel the popular TV program Vice News Tonight as part of a wider restructuring that will result in job cuts at the digital media company’s global news business.
Last month, BuzzFeed Inc said it would shut down its news division, which was known for its irreverent and investigative coverage but ultimately succumbed to the challenges of its digital business model.
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