Vice Media filed for Chapter 11 bankruptcy this morning ahead of a rescue by major investors including George Soros in another blow to the once-thriving ‘new media’ sector.
Financially troubled for years, Vice owed its creditors US$1bn according to US reports and now plans to arrange a sale to its lenders at a value of US$225mln, a fraction of the US$4.5bn it was worth at its height.
No new money is being raised, with the group of lenders converting their loans and taking over “significant liabilities” as part of the deal.
Vice had grown rapidly through its coverage mix of so-called edgy topics such as wars, drugs and sex.
But like peer Buzzfeed, which recently shut down its new service, the emergence of new platforms such as Tik Tok has seen the ‘new media’ providers left behind.
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Founder Shane Smith is expected to stay on after any sale with co-chief executives Hozefa Lokhandwala and Bruce Dixon also set to remain.
In a joint statement, they said: “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.”