Vice, the youth-focused media and content company, is in talks with private equity firms including the former owner of Formula One motor racing about an investment valuing it at close to $5.5bn (£4.4bn).
Sky News has learnt that Vice is in discussions with a handful of prospective financial backers about raising approximately $500m (£397m) to plough into its international expansion and a move into scripted programming.
CVC Capital Partners, the London-based buyout firm which relinquished control of F1 last year but remains a shareholder in the sport’s new parent company, is one of the firms in talks with Vice, according to insiders.
People close to the fundraising process, which is being run by two New York-based banks, said there was no certainty that CVC would strike a deal to invest in Vice.
The other parties in talks with the media company include other major private equity firms, the people added.
Part of the proceeds of the new fundraising will be dedicated to a new fund for the production of scripted programming, one of many strands of content creation into which the at times controversial company is expanding.
A deal, which could come as early as next month, will be seen by media industry-watchers as another step along the road towards an initial public offering of shares in Vice, which was founded in 1994 as a punk zine for music enthusiasts in Montreal, Canada.
No firm decision has been made by Shane Smith, Vice’s co-founder and chief executive, about whether to go public.
Speculation has mounted in recent months that The Walt Disney Company – already a shareholder in Vice – might seek to buy the company outright.
Known for its maverick reporting of subjects ranging from North Korea to Japanese tattooing, Vice became the first digital media brand to put its name to its own television channel.
In the UK, Viceland launched last year in partnership with Sky, the owner of Sky News.
Vice last raised money in 2015, when Disney spent $400m (£318m) on doubling its stake in the company to roughly 10%.
That transaction valued Vice at $4.2bn (£3.3bn), underlining the rapid growth in its appeal to media companies and financial investors alike.
The brand’s keen following among millennials – consumers who are hard to reach through traditional marketing channels but who are highly valued for their spending power – has explained its rise as one of the media sector’s fastest-growing companies of the last decade.
It employs more than 2500 people around the world.
Vice’s other shareholders include 21st Century Fox, which is currently trying to acquire full control of Sky, WPP Group, the marketing services giant, and Technology Crossover Ventures, a leading investor in digital businesses.
The Raine Group, a merchant bank which is helping to lead the latest fundraising, is also a shareholder.
Vice is targeting a presence in more than 80 countries by the end of this year, with digital, mobile and television offerings all on the agenda.
Last month, it announced plans to expand its mobile content presence to reach hundreds of millions of new customers, with a particular focus on the Asia-Pacific region.
Unveiling the strategy, Mr Smith said at the Mobile World Congress conference in Barcelona:
When we first started to roll out our global terrestrial TV programme, people thought I was nuts, ‘going backwards’, and a victim of my own hubris.
Our first batch of international mobile deals will now marry without TV platforms and digital platforms to offer a…platform-agnostic media company that offers our content at all times – everywhere.
Vice already operates a network of 13 digital channels covering subjects such as news and sport, a global TV brand, a production division and a creative services agency.
In addition to Sky plc, its partners include The Times of India Group, Moby Group in the Middle East, HBO, Canal+, Snapchat and Verizon Wireless.
Vice and CVC both declined to comment on Monday.
(c) Sky News 2017: Former F1 owner CVC joins race to secure £4.4bn Vice Media deal