VICE CAUGHT IN VI$E

Media firm in trouble as SPAC-deal talks fail

The once-bright star of Vice Media could face a darkening future after talks to go public through a special acquisition company fell through.

The Brooklyn-based media company founded by the bombastic exec Shane Smith has ended talks to go public via a merger with blank-check company 7GC & Co., according to a report from tech news site The Information.

Initially, Vice had planned to merge with 7GC in a deal valued at nearly $3 billion including debt, but the company likely didn’t have attractive-enough financials to make the deal work, sources familiar with the matter told The Post.

Now the new plan is to raise money to turn Vice profitable. The company includes female-focused site Refinery29, Vice News and fashion publication i-D. But sources familiar with the matter told The Post the new strategy is merely a way to stall before figuring out a longer-term plan of what to do next.

“This [investment] is basically a bridge to figuring out something,” said a source. “They’re in a pretty awful spot.”

Sources buzzed that Vice has only a few options left as SPAC talks have failed, which could include emergency cash bailouts from investors, cutting costs, selling the company or breaking up the business.

Neither Vice nor 7GC returned requests for comment from The Post.

Under its new plan to aim for profitability, Vice has raised $85 million from existing investors, The Information reported, adding that as part of the new strategy, Smith has “agreed” to give up voting control.

But sources told The Post that Smith, who will remain chairman of the board, was forced to relinquish voting control, as new investors wouldn’t agree to fund the company without gaining control.

Vice’s about-face comes as the once-red-hot SPAC market has begun to cool, in part because of new scrutiny from the Securities and Exchange Commission on overinflated revenue projections made by some startups that are merging with SPACs.

Multiple sources with knowledge of Vice’s business said going public was more of a “fantasy” than a reality for the company, which at its height in 2017 had a bloated valuation of $5.7 billion after private equity investor TPG gave the company a $450 million injection of capital.

Since then, Vice has stumbled in its effort to grow.

Founded as Vice Magazine in 1994 by Smith, the company steadily made its push to video and TV. By 2013, Vice had its own weekly news show on HBO. Three years later, it launched a cable channel, Viceland, which slumped in the ratings.

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

By 2019, the HBO show and the cable channel were canceled, news leaked out that Vice ponied up $1.87 million to settle a pay-disparity classaction lawsuit filed by female employees, and Smith was replaced as CEO by A&E boss Nancy Dubuc.