Vice Media Group has filed for bankruptcy and reached an agreement with its lenders to be purchased for $225 million. This represents just 4% of the company’s highest valuation of around $5.7 billion six years ago. 

The youth-targeted media brand, founded by Shane Smith in Montreal nearly 30 years ago, filed for Chapter 11 bankruptcy in the Southern District of New York, citing assets and liabilities between $500 million and $1 billion.

Despite the bankruptcy filing, Vice Media’s multi-platform brands, including Vice, Vice News, Vice TV, Vice Studios, Pulse Films, Virtue, Refinery29, and i-D, will continue producing and delivering content across various platforms.

The Co-Chief Executive Officers, Bruce Dixon and Hozefa Lokhandwala stated that the company would have new ownership, a simplified capital structure, and the ability to operate without the legacy liabilities that had burdened the business. They expressed optimism about completing the sale process in the next two to three months and paving the way for a healthy and successful next chapter at Vice.

Before the bankruptcy filing, Vice Media had undergone restructuring efforts, including laying off over 100 employees and discontinuing its Vice News Tonight broadcast. These actions were part of the company’s response to global macroeconomic conditions, a trend seen among several other media companies that recently laid off staff members.

Vice Media Group, known for its multi-platform approach, has received critical acclaim for its Emmy and Peabody Award-winning News division and its coverage of the war in Ukraine, which garnered millions of views on TikTok. The company’s studio group, including Pulse Films, has produced content for platforms like HBO Max, Netflix, ESPN, Sky, and Hulu.

Under a new agreement, the lenders, Fortress Investment Group, Soros Fund Management, and Monroe Capital, have agreed to make a $225 million credit bid for Vice Media’s assets and liabilities. Additionally, the lenders will provide a $20 million cash infusion to sustain the business while allowing the company to receive other bids.

The bankruptcy filing also reveals the financial impact on various companies and investors drawn to Vice Media’s potential growth. Private equity firm TPG, which invested $450 million in 2017, is among the major losers. Other investors include James Murdoch’s Lupa Systems and Disney, which previously took write-downs on its Vice investments totalling over $500 million.

While co-founder Shane Smith reportedly made $100 million from Vice, the exact valuation of his shares remains uncertain due to the company’s debts and ongoing sales processes. The bankruptcy proceedings also shed light on unpaid fees owed to vendors, with management consultants FTI Consulting and tech vendor Wipro having taken legal action to recover their dues.