Cirque du Soleil cuts 3,480 jobs

MONTREAL—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.

The company says it will seek court protection from creditors under the Companies’ Creditors Arrangement Act at a hearing Tuesday at Quebec Superior Court.

Cirque du Soleil also announced the termination of approximately 3,480 employees previously furloughed in March.

“We know, because of the proposal on the table, that the Cirque is saved,” CEO Daniel Lamarre said in a phone interview. “I am sure that at the end of the process, which should culminate in mid-September, I will have an owner.”

However, he said he regrets the end of the employment relationship of thousands of employees with the company, which has $900 million US in debt.

In connection with the filing, Cirque du Soleil says it has entered into a “stalking horse” purchase agreement with its existing shareholders.

The Texan fund TPG Capital (with a 60 per cent stake), the Chinese firm Fosun (20 per cent) and the Caisse de depot et placement du Quebec (20 per cent) will inject US$100 million, while Investissement Quebec will provide a $200-million US loan.

Two funds totalling $20 million US will also be set up to support Cirque workers and pay freelancers who are still waiting.

It says 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 its shows, the artists and show staff of the resident shows division are not affected.