Canada’s Cirque du Soleil Entertainment Group filed for chapter safety on Monday because the COVID-19 pandemic pressured the famed circus operator to cancel exhibits and lay off its artistes.
The Montreal-based leisure firm, which runs six exhibits in Las Vegas, has struggled to maintain its enterprise working amid coronavirus restrictions that began in March, forcing it to put off about 95 p.c of its workforce and quickly droop its exhibits.
“With zero income for the reason that pressured closure of all of our exhibits on account of COVID-19, the administration needed to act decisively to guard the corporate’s future,” Chief Executive Officer Daniel Lamarre mentioned.
The firm has signed an settlement with its current traders’ personal fairness fund TPG Capital, China’s Fosun International Ltd, and Canadian pension fund Caisse de depot et placement du Quebec underneath which the group will take over Cirque’s liabilities and make investments $300m to help a restart.
As a part of the funding, authorities physique Investissement Quebec will present $200m in debt financing.
But collectors are unlikely to conform to the deal, which might lead to current debt holders getting about 45 p.c fairness within the restructured firm, a supply conversant in the discussions instructed Reuters.
TPG, Fosun and the Canadian pension fund, which have held a majority stake within the leisure firm since 2015, may also be chargeable for a $15m worker fund to offer monetary help to laid-off staff.
Cirque mentioned it might search safety underneath the Companies’ Creditors Arrangement Act (CCAA), and its software can be heard on Tuesday by the Superior Court of Quebec. It may also search its speedy provisional recognition within the United States underneath Chapter 15.
The firm additionally mentioned the artists and present employees of resident exhibits in Las Vegas and Orlando, that are anticipated to renew earlier than the remainder of its exhibits, wouldn’t be impacted by the layoffs.