Cirque du Soleil files for bankruptcy protection

Members of the cast from The Beatles' 'LOVE' by Cirque du Soleil perform at the Musi Cares Person of the Year gala honoring Paul Mc Cartney in Los Angeles Calif. on Feb. 10 2012

Cirque du Soleil files for creditor protection amid COVID-19 woes

"We know, because of the proposal on the table, that the Cirque is saved", CEO Daniel Lamarre said in a phone interview.

Cirque, responsible for many blockbuster Las Vegas as well as touring circus arts shows, had suspended performances in March because of both pandemic stay-at-home orders and lack of demand for large venue shows.

The Cirque du Soleil, whose aerobatic shows have been halted by COVID-19, has filed for creditor protection while it develops a plan to restart its business. When the wave of COVID-19 closures hit, the debut was postponed indefinitely, and while no new dates have been announced, company officials believe the show may premiere in the Fall, considering there are no health and safety restrictions on shows.

At the same time, Investissement Québec, the financial arm of the provincial government, will provide US$200 million in debt financing to support the proposed acquisition.

The company says it will lay off more than 3,500 people.

Impacted employees are meant to be rehired as Cirque du Soleil restarts its business, and mandatory COVID-19 shutdowns are lifted in impacted markets, the company said.

Cirque du Soleil has now entered into a "stalking horse" bid from private equity backers in the U.S., Canada and China of $420 million that aims at drawing other bidders in an auction.

Shareholders will put aside $20m for extra relief for employees and contractors affected by the move.

The company's existing secured creditors will get $50 million of unsecured, takeback debt as well as a 45% equity stake in the restructured company.

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 company also said the artists and show staff of resident shows in Las Vegas and Orlando, which are expected to resume before the rest of its shows, would not be impacted by the layoffs.

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