A&E deal would price Vice at $2.5 billion

By By Katie Lobosco and Cristina Alesci
Published On: Aug 29 2014 08:41:59 PM EDT
Updated On: Aug 29 2014 10:29:16 PM EDT

Trish Parisy/SXC

NEW YORK (CNNMoney) -

For Vice, it's finally paying off to cover the edgy news no one else will touch -- big time.

Vice Media is in talks with A&E about a deal that would value it at more than $2.5 billion, according to a Vice spokesman.

A&E would buy a 10% stake in the company.

Vice would also create content for the A&E cable networks, according to a person with knowledge of the negotiations.

Its online content, magazine and HBO series, called Vice, specifically targets millennials.

On YouTube, the Vice channel has nearly 5 million subscribers. Its most popular video, "First Animal to Survive in Space," has 12.1 million views, followed by "The Biggest Ass in Brazil," which has been viewed 10.6 million times.

A&E, which also owns the Lifetime and History channels, is buying the stake to gain digital exposure.

A&E is jointly owned by Disney and the Hearst Corporation. An A&E spokesman declined to comment.

Time Warner was also interested in buying a stake in Vice, but those discussions are now over, according to a person familiar with the negotiations. (Time Warner owns CNN.)

This isn't the first time Vice has attracted investment from an established media company. Rupert Murdoch's 21st Century Fox paid $70 million for a 5% stake last year.

Vice's other minority shareholders include marketing services firm WPP, The Raine Group and former Viacom chief executive Tom Freston.

The company's co-founder Shane Smith has said he wants Vice to be the "next CNN" and "next MTV."

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