The Canadian entertainment company said it has entered a ‘stalking horse’ agreement with its existing shareholders including TPG Capital, Fosun International Ltd , and Caisse de depot et placement du Québec, under which the group will take over Cirque’s liabilities and invest $300 million.
As part of the investment, government body Investissement Québec will provide $200 million in debt financing.
Montreal-based circus arts show company temporarily suspended its productions around the world in March because of the coronavirus outbreak. The show Totem is shown here
‘With zero revenue since the forced closure of all of our shows due to COVID-19, the management had to act decisively to protect the Company’s future,’ said CEO Daniel Lamarre.
The company in March laid off more than 4,000 people, or 95% of its workforce, and temporarily suspended its shows in Las Vegas, one of its prominent areas.
The CCAA is a Canadian Federal Act that allows large corporations to restructure their finances and avoid bankruptcy, while allowing creditors to receive some form of payment for amounts owed to them.
Cirque’s CCAA application will be heard on Tuesday by the Superior Court of Quebec.
Cirque du Soleil also announced the termination of approximately 3,500 employees previously furloughed in March
In connection with the filing, Cirque du Soleil said it has entered into a purchase agreement with its existing shareholders TPG, Fosun and Caisse de depot et placement du Quebec as well as Investissement Quebec as a debt provider.
Its said the sponsors´ bid includes an intent to rehire a substantial majority of the terminated employees, business conditions allowing, when its operations can resume.
The company added that given that its resident shows in Las Vegas and Orlando are expected to resume before the rest of the other shows, the artists and show staff of the resident shows division are not affected.
Cirque is drowning in nearly $1 billion in debt, according to CNN Business.
The Las Vegas shows that were cancelled included O at the Bellagio, KA at MGM Grand, The Beatles LOVE at the Mirage, Mystere at Treasure Island, Zumanity at New York-New York and Michael Jackson ONE at Mandalay Bay.
Cirque du Soleil shows in Austin, Texas, Chicago, Houston, New Orleans, Salt Lake City, Montreal, Boston, Tel Aviv, Meloneras, Spain, Munich, Costa Mesa, Denver, and the Australian cities of Melbourne, Adelaide and Perth have also cancelled.
The creator of many of the most popular shows in Las Vegas blamed the ‘immense disruption and forced show closures as a result of COVID-19’
Credit — dailymail.co.uk