A group of buyers, including Fortress Investment Group, is poised to take over the bankrupt Vice Media company after submitting a bid of $225 million, according to three individuals familiar with the matter. This acquisition bid out of bankruptcy surpassed other offers, which failed to meet Vice’s criteria for qualified buyers. However, the final approval of the deal rests with a bankruptcy judge who determines the sustainability of the business plan for emerging from bankruptcy, as per an exclusive New York Times report.
Confidentiality surrounds the ongoing process, prompting the three sources to share information on the condition of anonymity. As a result, the scheduled bankruptcy auction for Vice Media will be called off. In an internal email to Vice employees, co-chief executives Hozefa Lokhandwala and Bruce Dixon confirmed their intention to present Fortress’s bid to the bankruptcy court for approval. They clarified that while multiple bids were received, none were considered superior.
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Fortress’s bid deemed ‘qualified’ among multiple offers
Lokhandwala and Dixon anticipate the sale to conclude in July, leading to Vice operating under new ownership. Additionally, there is potential for Fortress to generate interest from buyers in Vice’s individual business units, such as Vice Studios, Virtue, and i-D. This approach could help recoup their investment. Vice, which had struggled to sell itself for several years, filed for bankruptcy in May, with Fortress as a prominent lender positioned to assume control. The company pursued a sale during bankruptcy proceedings to gauge additional interest.
As the sale progresses, Vice must address pressing concerns. Numerous freelancers have reported unpaid wages, while unionised employees have expressed dissatisfaction with the company’s employee reduction strategy and the perceived inadequacy of severance packages.
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Despite these challenges, Vice has achieved programming successes. Internal communication from Lokhandwala and Dixon highlighted the popularity of titles, such as the ESPN documentary “Bama Rush” and “American Gladiators” on various platforms.
While the future roles of Vice’s key figures remain uncertain, it is likely that Shane Smith, the co-founder synonymous with Vice’s bold journalism, will retain a position within the company. Lokhandwala and Dixon are also expected to continue as co-chief executives.
$225 million bid to alleviate Vice’s heavy debt load and complex capital structure
Fortress Investment Group and Soros Fund Management lead the $225 million bid, which will be financed through existing loans to Vice. By acquiring Vice out of bankruptcy, Fortress will be able to operate the business without the burden of heavy debt and complex capital structures.
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