Cirque Du Soleil Files For Bankruptcy
Quebec-based high-quality artistic entertainment company Cirque du Soleil has for more than three decades been providing premium performance entertainment to people in over four hundred cities in sixty countries. What had started out as a group of 20 street performers under the leadership of performing artists Guy Laliberte and Gilles Ste-Croix back in 1984, eventually grew into an organisation employing close to 4,000 employees from more than 50 countries. So popular did the organisation’s acts turn out to be, that Circe du Soleil soon became the marquee act of choice to all of Vegas.
But sadly, Cirque du Soleil is also the company that this week filed for Canadian bankruptcy protection – a move CEO Daniel Lamarre described as an act by management in an attempt to protect the company’s future.
Protection From Creditors
It’s no secret that the company had been treading debt-infused waters for quite some time. But its also true that were it not for the recent cancellation of all of its shows in Las Vegas as well as the world over, Cirque du Soleil would probably not have been drowning in nearly $1 billion in debt. Zero revenues since March meant not only increasing pressure resulting from untenable debt, but also the laying off of around 3,500 employees – of which at least 1,300 are workers stationed in Las Vegas. The 3,500 workers laid off represented roughly 95% of the company’s staff profile.
If a Superior Court were to approve the application for protection from creditors under the Companies’ Creditors Arrangement Act in Quebec, the company will be free to apply for “Chapter 15” protection in the US. Chapter 15 is a bankruptcy filing process that acts as a protective mechanism designed to facilitate international insolvency concessions.
2015 Proved The Turning Point
The company has for decades long been the go-to source for entertaining performances on the Las Vegas Strip. It has held residencies at New York-New York, the famous Luxor, the Mirage, Aria, and at the MGM Grand. Cirque is also an official entertainment partner of MGM Resorts.
But the company traces its downward spiral all the way back to 2015 – to the time immediately following the sale of Cirque du Soleil to its current owners. Many are of the opinion that the act’s new owners had forced the act away from a creative arts approach and in the direction of a corporate culture driven by analytics and profits. This, they say, was the real undoing of the world-famous act.