Vice’s Chief Restructuring Officer, Frank Pometti, stated that Wipro may have played a part in Vice’s bankruptcy as they owed $9.9 million. This owed amount came after Wipro initiated arbitration proceedings against Vice Media in May 2020, which were connected to the termination of an agreement.
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Indian IT major Wipro may have been one of the factors that precipitated Vice Media voluntarily filing for bankruptcy, the latter’s filings showed. The media group owes Wipro $9.9 million after the latter won an arbitration award. Wipro is Vice’s largest unsecured creditor.
Vice Media Group filed for Chapter 11 protection on May 15 in a New York bankruptcy court, with $834 million in debt and $350 million in assets.
In a court filing, Vice’s Chief Restructuring Officer Frank Pometti said that while the company relied on external funding — both debt and equity — to fuel its growth and fund expenses, it also resulted in the company “being burdened by a highly leveraged and unusually complex capital structure.”
However, while the company had been struggling and was facing a financial crunch, two factors made it inevitable that the company file bankruptcy — one of them was Wipro.
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Pometti’s filings said that Wipro commenced arbitration proceedings against Vice Media in May 2020, which was related to the termination of an agreement. A Vice spokesperson had told Insider in February that the award “is the result of a failed outsourcing arrangement that VICE terminated some 3 years ago”.
The arbitrator ruled in favour of Wipro earlier in March, with the IT firm winning an award of $7.9 million plus interest at a rate of 9 percent, resulting in a total amount of nearly $9.9 million.
Wipro then approached the Supreme Court of the State of New York, and on May 4, got a judgment related to the arbitration award.
The company announced that George Soros has purchased Vice Magazine and will provide $225 million in the form of a credit bid for most of Vice Media’s assets.
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