The company behind the websites Vice and Motherboard has filed for bankruptcy in the US and is set to be sold to a group of its lenders.
Vice Media Group – which was once valued at $5.7bn (£4.5bn) – could be taken over for $225m.
The youth-focused digital publisher said it will continue to operate during the bankruptcy process.
It added that it “expects to emerge as a financially healthy and stronger company in two to three months”.
Launched in 1994 as a fringe magazine called Voice of Montreal by Shane Smith, Gavin McInnes and Suroosh Alvi, Vice currently operates in more than 30 countries.
Its edgy, youth-focused content spans print, events, music, online, TV and feature films.
Vice Media Group’s investors include Fortress Investment Group, Monroe Capital and Soros Fund Management – the firm founded by fund manager and billionaire George Soros.
The hope was that Vice would reap the financial rewards from attracting millions of younger readers through social media networks such as Facebook and Instagram.
However, ultimately the majority of online ad revenues have gone to tech giants such as Google and Facebook-owner Meta.
The company’s revenues have been flat for some years and it has also struggled to turn a profit. Vice’s plans to go public through a merger also failed.
Last month, it announced layoffs after its flagship TV programme was shut down.
BuzzFeed, another pioneering online platform, also recently announced that it was shutting down its news division and laying off 15% of its workforce amid serious financial challenges and a slump in advertising revenue.
Vice Media has filed for Chapter 11 bankruptcy protection, a procedure which postpones a US company’s obligations to its creditors, giving it time to reorganise its debts or sell parts of the business.
Vice’s lenders have approved $20m of funding to keep the firm going through the bankruptcy process. During this time, other firms can submit “higher or better” bids for the media company.
If these offers are not successful, Vice Media’s lenders will acquire the publisher for $225m.