Vice Media Hires Financial Advisor for Sale: Report

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Vice Media, the Brooklyn-based digital media company founded by Shane Smith, has hired bankers to put the company up for sale, according to a report.

Several buyers have expressed “preliminary interest” in buying Vice outright, CNBC reported Monday night. Vice, which is struggling with unpaid debt and failed to go public through a special acquisition company, is also considering a partial sale, according to the report.

Vice, the once high-flying digital media darling valued at $5.7 billion, is buying its lucrative content studio business and has hired banks PJT Partners and LionTree for the deal, the news reported Friday.

According to CNBC, Vice’s most sought-after assets are probably its content studio and creative advertising agency, Virtue, which includes Pulse Films, known for producing films like “Pig,” starring Nicolas Cage, the documentary “Bikram: Yogi, Guru, Predator”. and Beyoncé’s “Lemonade”.

At its peak, Vice, founded by Shane Smith, was valued at $5.7 billion.
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Vice attempted to go public through a SPAC last year, striking a deal with 7GC & Co Holdings. It was aiming for a valuation of around $3 billion, including debt, when it attempted to go public last year. If Vice agrees to a deal to sell the entire business, the price is likely to be significantly lower than that, sources told CNBC.

Vice’s SPAC plans fell through when the market cooled and investors were unconvinced by Vice’s finances and prospects as a stand-alone public company.

Multiple sources with knowledge of Vice’s business told the Post at the time that the IPO was more “fantasy” than reality for the company, which at its peak in 2017 had an inflated valuation of 5. .7 billion after private equity investor TPG gave the company a $450 million capital injection. But that infusion came at a cost, as Vice agreed to heavy future refunds, according to reports.

Since then, Vice has stumbled in its efforts to grow its business, which has been marred by controversy, dodgy deals and cost cuts.

Vice HQ in Brooklyn
Vice attempted to go public through a SPAC, but those plans fell through, as the market cooled.
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“No one in the industry seriously thought Vice was ready to go public. It would never happen,” a person with knowledge of the matter said at the time. “The company is in an endless cycle of layoffs, pivots and emergency cash injections for half a decade. It looks like the downward spiral is still going on.

Founded as Vice Magazine in 1994 by the brilliant Smith, the company gradually made its way into video and television. In 2013, Vice had its own weekly news show on HBO. Three years later, he launched a cable channel, Viceland, which dropped in ratings.

Under Smith, Vice had big dreams of becoming a media juggernaut with revenues reaching $1 billion by 2015. But a series of critical reports in 2018 about how Vice was built on bluffs and smoke and mirrors by Smith, who allegedly oversaw a toxic work environment for female staff, tarnished the company and its founder.

Nancy Dubuc
Under the leadership of CEO Nancy Dubuc, Vice embarked on an aggressive restructuring and cost reduction plan.
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Vice’s fortunes soured and in 2019 the HBO show and cable channel were canceled, news leaked that Vice had paid $1.87 million to settle a pay equity class action lawsuit filed by employees, and Smith was replaced as CEO by A&E boss Nancy Dubuc.

Dubuc had been tasked with changing the company’s so-called bro culture and she was tasked with integrating Refinery29, the struggling media giant focused on girl power, which the company acquired in 2019 as part of of an all-stock transaction. This deal not only lowered Vice’s overall valuation to around $4 billion at the time, but it also baffled media observers.

“Crops are oil and water. Misogyny meets feminism,” a digital executive told the Post at the time. “When they merge, there will be very deep cuts on the refinery side,” the exec predicted. “Vice will gut them.”

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Brooklyn-based Vice was once the industry’s digital media darling. Now it seems to be selling as parts.
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The source wasn’t too far off, as there were several rounds of reorganizations under Dubuc across the company, which not only helped reduce costs, but also increased revenue. The Wall Street Journal reported last year that Vice estimated it would hit $1 billion in revenue by the end of 2023.

Now Vice is eyeing a sale as it seeks cash for investors and to help pay down around $1 billion in debt.

CNBC said discussions with potential buyers are ongoing and no deal is certain or imminent. TPG is not interested in buying all of Vice and is instead looking to monetize a portion of its investment, according to the report.

A vice-rep told the publication: “The market is currently very active in the studio space and we have built a world-class studio business on a global scale that generates inquiries – when there is this kind of interest, we have to consider it for our investors.Beyond that, there is nothing to comment on.

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