Montreal-based circus arts show company temporarily suspended its productions around the world in March because of the coronavirus outbreak. Under the deal, the firms will provide Cirque with $300 million of liquidity to help it resume operations at some point in the future.
The company says it will lay off more than 3,500 people.
In exchange for debt restructuring, creditors will receive unsecured debt of US$50 million in addition to owning 45 per cent of the Cirque, which will decrease the current shareholders' stakes.
As expected, the company said in its filing announcement the refinancing move was "in response to enormous disruption and forced show closures as a result of the COVID-19 pandemic".
Cirque du Soleil, the producer of numerous acrobatic theater shows like La Nouba, which played at Disney World for almost 20 years and the maker of a new show that was scheduled to appear earlier in the year, has filed for bankruptcy, CNN reported Monday.
Investment firms TPG, Fosun Group and Caisse de Depot et placement du Quebec have submitted a proposal to buy the circus company's assets. Under the acquisition, two funds for $20 million will be set up to provide monetary relief for employees and contractors impacted by the Chapter 15 filing.
Cirque de Soleil performs an act at the Entertainment Quarter, Moore Park in 2019.
Cirque said it will seek protection under the Companies' Creditors Arrangement Act (CCAA), and its application will be heard on Tuesday by the Superior Court of Quebec.
The company has also received U.S. $436 million in fresh funding to "support a successful restart, provide relief for Cirque du Soleil's affected employees and partners, and assume certain of the company's outstanding liabilities", it said in the release.
The Las Vegas shows that were cancelled included O at the Bellagio, KA at MGM Grand, The Beatles LOVE at the Mirage, Mystere at Treasure Island, Zumanity at New York-New York and Michael Jackson ONE at Mandalay Bay.