SHARE MONTREAL -- A group of Cirque du Soleil creditors is in the process of taking control of the business: its latest offer to purchase, in which Quebec taxpayers will not have to contribute financ
ially to the Cirque's recovery, has been accepted."The cooperation of the group of creditors has been extraordinary in order to achieve our objective of recapitalizing the Cirque," Gabriel de Alba, the managing director and partner of Catalyst Capital Group , said in a statement Thursday. Catalyst and the creditors agree to respect the history of the Cirque."
This new offer terminates the agreement valued at approximately US $420 million that was reached with the Cirque's current shareholders, the Texan fund TPG Capital, the Chinese firm Fosun and the Caisse de depot et placement du Quebec, on June 29, when the Cirque filed for protection under the Companies' Creditors Arrangement Act . That deal was banking on a loan of US $200 million offered by the Quebec government.
The group of creditors, which holds guaranteed debt of about US $1 billion from the Cirque, would inject up to US $375 million in new money and maintain the company's head office in Montreal, according to a source familiar with the matter but who is not authorized to speak publicly. The debt would be reduced to around US $300 million and a fund would also be set up to retain employees and pay ex-workers and artisans.
Deprived of income since mid-March due to the health crisis caused by the COVID-19 pandemic, the Cirque has canceled its 44 shows and laid off some 3,480 people. As part of the sale process, other potential buyers may submit a bid. During a hearing before the Superior Court, last Friday, a lawyer representing Quebecor had suggested the media and entertainment conglomerate was preparing a bid.
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