Vice and Motherboard owner files for bankruptcy 2023

Vice and Motherboard owner files for bankruptcy

Vice Media Group, the company responsible for popular websites Vice and Motherboard, has made the decision to file for bankruptcy in the United States. As part of this process, the company is set to be sold to a consortium of its lenders. Despite these financial difficulties, Vice Media Group intends to continue its operations throughout the bankruptcy proceedings. The company remains optimistic, expecting to emerge from this period as a financially robust and stronger entity within the next two to three months.

Vice Media Group, originally launched in 1994 as Voice of Montreal, started as a fringe magazine founded by Shane Smith, Gavin McInnes, and Suroosh Alvi. Over the years, it has expanded its reach and currently operates in more than 30 countries. Recognized as a pioneer in delivering edgy, youth-focused content across various mediums including print, events, music, online platforms, television, and feature films, Vice was once seen as a disruptive force in the traditional media landscape.

Back in 2012, media tycoon Rupert Murdoch acknowledged Vice’s potential when he tweeted about the company after visiting its office in Brooklyn: “Who’s heard of VICE media? Wild, interesting effort to interest millennials who don’t read or watch established media. Global success.” The company’s repertoire includes notable productions such as “My Journey Inside the Islamic State,” where a Vice journalist documented their experience alongside the terror group in Syria. They have also covered unique stories like basketball star Dennis Rodman’s sports diplomacy trip to North Korea with the Harlem Globetrotters.

READ ASLO:2023 Thailand elections: Voters deliver stunning blow to army-backed rule

Fortress Investment Group, Monroe Capital, and Soros Fund Management, the investment firm founded by billionaire George Soros, are among Vice Media Group’s investors. The company had hoped to generate significant financial gains by capturing the attention of millions of young readers through popular social media platforms like Facebook and Instagram. However, the majority of online advertising revenues have gravitated toward tech giants such as Google and Meta, the parent company of Facebook. This, coupled with stagnant revenues and the inability to turn a profit, has posed significant challenges for Vice Media Group. Its previous plans to go public through a merger also faltered.

The recent layoff announcements and the closure of its flagship TV program have added to the company’s woes. Buzzfeed, another influential online platform, has faced similar challenges, with the closure of its news division and a substantial reduction in its workforce due to financial constraints and declining advertising revenues.

To navigate this difficult financial landscape, Vice Media has filed for Chapter 11 bankruptcy protection, a legal process that allows a company to postpone its obligations to creditors while it reorganizes its debts or divests parts of the business. In their statement, Vice’s co-CEOs, Bruce Dixon and Hozefa Lokhandwala, expressed their belief that this court-supervised sale process will strengthen the company and position it for sustainable long-term growth.

To support Vice Media during the bankruptcy proceedings, its lenders have approved $20 million in funding. During this period, other interested parties will have the opportunity to submit higher or improved bids for the media company. If these offers prove unsuccessful, Vice Media’s lenders will acquire the company for a sum of $225 million.

The sale process is expected to take approximately two to three months, and it will determine the future direction of Vice Media Group. As the company embarks on this transformative phase, it faces both challenges and opportunities in the ever-evolving media landscape.

Leave a Reply