Digital-news outfit Vice Media is eyeing a $3 billion SPAC merger - half its worth 4 years ago, report says

• Vice Media is seeking a $3 billion valuation via a blank-check company merger, WSJ reported.
• The digital-news firm's existing investors would own 75% of the company under the proposal.
• Ex-Morgan Stanley exec Jack Leeney's SPAC and other new investors would own the other 25%.

Vice Media, a youth-focused digital publisher, is in discussions to merge with a special-purpose acquisition company in a deal that could value it at $3 billion, the Wall Street Journal reported on Monday.

That would be a discount from Vice's $5.7 billion valuation four years ago when it secured a $450 million infusion from private-equity firm TPG Capital.

The media company could combine with former Morgan Stanley executive Jack Leeney's SPAC, 7GC & Co. Holdings, WSJ said, citing sources.

Vice's existing investors - TPG, Walt Disney, and A&E Networks - would own 75% of the digital media company upon completion of the deal. Leeney's SPAC, combined with other new investors, would own the remaining 25%.

There's no guarantee a deal could be reached at the moment, as there has been no definitive agreement as yet.

The SPAC boom that saw red-hot activity in 2020 has been losing steam given an increase in scrutiny from the Securities and Exchange Commission. The regulator has been warning would-be SPAC dealmakers of the risks and complexities associated with mergers, as tainted projections are often used to pitch deals.

7GC plans to pitch Vice's multiple revenue streams to draw in investors, such as its Virtue ad agency, Vice Studios film and TV production arm, and women-focused brand Refinery29, WSJ said.

Under the proposed deal, CEO Nancy Dubuc would retain her position along with other executives. Founder Shane Smith would keep executive chairmanship.

Vice Media declined to comment on the potential SPAC deal.

The American-Canadian company laid off a handful of staffers from its leadership team as part of a restructuring earlier this year. Employees were told those laid off would not be replaced by newcomers.

It is one among a growing list of media companies that have either gone public via a SPAC, or intend to do so, in the future. Insider identified 12 SPACs worth watching in media, telecommunications, and entertainment.