A&E deal would price Vice at $2.5 billion

August 31, 2014: 1:46 PM ET
vice shane smith
Vice's co-founder Shane Smith has said he wants Vice to be the "next CNN" and "next MTV."
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.

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

Time Warner (TWX) 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.

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

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