Vice Media restarts sale process at lower valuation

Vice Media is restarting its sale process after earlier interested bidders balked at the initial price tag, according to people familiar with the situation.

The digital media company, which was valued at $5.7 billion in 2017, is now likely to fetch a price of below $1 billion, the people said. Initially, Vice was looking for a valuation between $1 billion and $1.5 billion, one of the people added. The people weren’t authorized to speak publicly on the matter.

A Vice Media spokesperson didn’t immediately respond to comment.

Vice last year hired advisers to facilitate a sale of some or all of its business, CNBC previously reported. Some of its most attractive assets are likely to be its content studio and creative advertising agency, Virtue, CNBC previously reported, but the company is attempting to sell itself in full rather than in pieces, the people said.

One of Vice’s lenders, Fortress Investment Group, is a driving force in the sale process, the people said, and has agreed to wait on loan repayment. Fortress was reportedly part of a consortium of lenders in 2019 that provided $250 million in debt to Vice.

Vice has lowered its expectations in hopes of getting a deal done and securing a payout sooner rather than later, the people said.

The company had been nearing a deal with Greek broadcaster Antenna Group, but those talks stalled in recent weeks, the people said. Antenna is still likely to be an interested bidder in the renewed sale process, they added.

Representatives for Antenna and Fortress declined to comment.

Digital media companies have fallen from great heights from in recent years as growth has stalled due to shrinking audience numbers and advertising. They’ve particularly faced growing competition for ad dollars from tech giants like Google. Media companies in general have been facing a slowdown in advertising revenue as macroeconomic conditions have caused a pullback from advertisers.

Meanwhile, Buzzfeed, the only digital media company to IPO, has seen its stock fall roughly 90% since going public in 2021.

Vice reached its peak valuation in 2017 with a $450 million investment from private equity firm TPG, valuing the company at the time at nearly $6 billion.

The company later targeted a valuation of roughly $3 billion, including debt, when it attempted to go public via special purpose acquisition company 7GC & Co Holdings in 2021. However those plans also stalled after the market cooled and investors were no longer sold on Vice’s prospects as a standalone public company.

Vice ended 2022 with a slight gain in revenue, but the business deteriorated among macroeconomic headwinds, according to a person familiar with the matter. Vice missed its revenue goal by more than $100 million for 2022, The Wall Street Journal previously reported.

While the company was unprofitable last year, some of its units did post a profit, and Vice has been intermittently profitable in recent years, the person added.

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