From Disruptor to Disrupted: Vice Media Prepares for Bankruptcy

Vice Media, the brash digital media disruptor that once charmed media giants like Disney and Fox into investing, is reportedly on the brink of filing for bankruptcy. It seems like the company’s dreams of taking over the media establishment have turned into a nightmare.

While the company is still looking for a potential buyer to avoid bankruptcy, the chances of a successful sale are dwindling, the New York Times reported. Sources told the news agency that a bankruptcy filing is looming, which would be a sad ending to the company’s tumultuous journey.

Vice began as a punk magazine in Montreal over two decades ago but slowly evolved into a global media organisation with a film studio, an ad agency, and even an HBO show. However, the company has consistently failed to earn a profit, losing money and laying off employees left and right. In fact, Vice’s value today is a tiny fraction of what it was worth in 2017 – $5.7 billion, after a funding round from private equity firm TPG.

If Vice does file for bankruptcy, Fortress Investment Group, the company’s largest debtholder, could end up controlling the company. The good news is that Vice will continue operating normally and hold a 45-day auction to sell the company. Fortress is the most likely to acquire it, so the company’s fate appears to be in good hands.

Unlike Vice’s other investors, which have included Disney and Fox, Fortress holds the senior debt, which implies it is paid first in the case of a sale. Disney has already written down its investments and is not receiving a return.

But let’s remember that Vice has already lost a lot of its luster, and the closure of its Vice World News division last week was just another blow to its already shaky foundation. Employees who saw the division’s aggressive coverage, especially when its co-founder, Shane Smith, would report from dangerous locations such as North Korea, in keeping with Vice’s roots in gonzo journalism, were left reeling.

So, what does the future hold for Vice? Only time will tell. But one thing’s for sure – the bankruptcy of Vice Media will be a tragic end to the story of the new-media interloper that once sought to overthrow traditional media outlets.

In the meantime, Vice continues to evaluate its options, with its board and stakeholders focused on finding the best path forward. With a turnover in its leadership ranks, Vice will need all the help it can get.