Cirque du Soleil Bankrupt
World-renowned circus producer Cirque du Soleil is the pandemic’s latest cultural casualty.
The Canada-based entertainment company has filed for bankruptcy protection as it attempts to stick a decent landing while hurdling the ongoing health crisis.
A restructuring plan might save the company, but the trade-off is not looking pretty.
For one, BBC reports that Cirque would have to take the $200 million loan offered by the Quebec government, lest it wants to be sold to foreign hands.
Worse, the firm would have to fire about 3,500 of its artists and employees to cut losses.
Walking A Tightrope
This pandemic could not have come at a worse time for the touring circus.
Even before it was forced to suspend production and cancel all shows due to the looming threat of a spreading virus, the company has been piling on more than $1 billion in debt.
In a report, The Jakarta Post revealed that Cirque has been on an expensive acquisition and renovation spree since 2015, and has not yet recouped the money.
Shareholders have ponied up $300 million in fresh funding to bolster a possible restart -- the only thing going for the company as of writing.
Even then, the Purchase Agreement that will make these funds available for the company comes with a provision that relinquishes 45 percent of company stakes to Cirque’s creditors.
“For the past 36 years, Cirque du Soleil has been a highly successful and profitable organization,” CEO Daniel Lamarre said in a statement. “However, with zero revenues since the forced closure of all of our shows due to COVID-19, management had to act decisively to protect the company’s future.”
No Clear Timeline
Bar none, the easiest way Cirque could avoid a hard landing is to get back to staging shows.
However, officials have said they “have no clear timeline on when [they] will be allowed to get back on stage.”
All hope is not lost, though, as the firm has yet to refund ticket holders for passes they purchased for future shows. In fact, a press release published on its website advised customers to hold on to their tickets.
Much of Cirque’s future hinges on uncertainty. They might be able to rewrite the stars once travel restrictions round the globe are eased. Until then, though, prospects for the circus remain bleak.