Vice Media has bought Refinery 29, reportedly for around $400m, predominantly in shares. The Financial Times estimated the deal valued the combined company at $4bn which would represent a decline in Vice’s valuation since its 2017 investment from TPG valued it at $5.7bn. Refinery29, launched in 2005, was valued at $500m in a 2016 funding round. But its backers Discovery and Turner Group (Warner Media), will take shares in Vice Media; Disney and Hearst had already written down their shareholdings in the company.
The two US companies operate in lifestyle media, Vice has a youth and entertainment focus, Refinery 29 is oriented towards women’s lifestyle, including events, describing itself as the “modern woman’s destination.”
Vice CEO Nancy Dubuc called the merger “a transformative day” saying “with this acquisition, we’ll be growing our investment in premium content production across all our divisions.” Vice started in Montreal in 1994 as a drug culture magazine but has transformed into a global media company employing 3,000 with backing from major brands including Disney and 21st Century Fox (which is now owned by Disney).
Dubuc took the helm of the loss-making company from founder Shane Smith in 2018. She is determined to turn it round; 10% of staff have been made redundant in 2019. There may be further reductions in headcount following the acquisition, in admin rather than editorial. Vice raised $250m in debt finance earlier this year from investors including George Soros. The CEO is also leading efforts to end the company’s reported “boys’ club” corporate culture, following sexual harassment proceedings by more than 20 women.
The Information summed up the deal perfectly: “All of it feels very up in the air. But this combination may end up providing the clearest test case of whether this era of highly funded digital media companies can really turn out the next generation of powerful media companies that investors were once banking on. ” So who’s next?