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Emond identified two conditions as an “absolute necessity” for the Cirque to succeed — a “strategic operator” with a deep knowledge of the industry, and a smaller debt load.
“It needs a strategic operator to allow the Cirque to reinvent itself, a Cirque 2.0,” Emond said. “It also needs a reasonable debt level. It’s not the best company for high leverage.”
The offer by a group of Cirque debt holders led by Toronto firm Catalyst Capital Group is valued at approximately US$1.2 billion, according to court-appointed monitor Ernst & Young.
Up to US$375 million will be made available to the Cirque, while two funds totalling US$20 million will be set up to pay money owed to former employees and artisans. The agreement also commits to maintain Cirque’s head office in Montreal for at least five years.
“No matter what happens, there’s a minimum value out there which the debt holders have actually agreed to pay, and conditions for maintaining the Cirque here and taking care of various stakeholders,” Emond said. “That’s something you’d never see in a process like that. So there’s a minimum outcome that’s already been achieved.”
Other bidders have until Aug. 18 to submit a fully funded offer that is at least US$1.5 million higher than the creditor bid.
Canadian Press contributed to this report
