Vice Media Group has agreed to sell its assets to a consortium of lenders in exchange for $225 million. The lender consortium includes names such as - Fortress Investment Group, Soros Fund Management and Monroe Capital.
The Group has approached the US Bankruptcy Court for the Southern District of New York with a voluntary petition for reorganisation. It is seeking approval of the proposed transaction pursuant to relevant sections of the US Bankruptcy Code, allowing outside parties to submit higher or better bids for the business.
The company was valued at $5.7 billion six years ago, eyeing a potential IPO.
Vice is expecting that the sale will conclude in the next two to three months, ensuring the uninterrupted production of content by its media brands. Additionally, it said the company will maintain regular payments to its employees and vendors throughout the process.
"This accelerated court-supervised sale process will strengthen the Company and position Vice for long-term growth, thereby safeguarding the kind of authentic journalism and content creation that makes Vice such a trusted brand for young people and such a valued partner to brands, agencies and platforms. We will have new ownership, a simplified capital structure and the ability to operate without the legacy liabilities burdening our business. We look forward to completing the sale process in the next two to three months and charting a healthy and successful next chapter at Vice," Bruce Dixon and Hozefa Lokhandwala, Vice's Co-Chief Executive Officers, said.
Vice has also obtained commitments for debtor-in-possession (DIP) financing from the Lender Consortium, as well as consent to use more than $20 million of cash that constitutes the cash collateral of the Lender Consortium, the company stated.
Vice is hopeful that this financing, as well as the cash generated from ongoing operations, will be sufficient to fund its business throughout the sale process, it added.
Vice experienced lower-than-expected revenues in recent years and faced challenges in achieving profitability. Additionally, the media group's attempt to go public via a merger was unsuccessful, as per reports.