The Cirque du Soleil, whose aerobatic shows have been halted by COVID-19, has filed for creditor protection while it develops a plan to restart its business.
The involvement of Investissement Québec in the form of $200 million United States in debt financing requires the investors to commit to keeping the company's headquarters in Montreal.
The move, which was announced on Monday in a statement, means the famous Quebec-based circus and some of its affiliated companies have filed for protection from creditors under the Companies' Creditors Arrangement Act in Quebec Superior Court. If granted, the Canadian company will then seek bankruptcy protection in the United States.
The circus company was forced to cancel dozens of productions around the world since March, when public health guidelines began barring live entertainment events.
"With zero revenue since the forced closure of all of our shows due to COVID-19, the management had to act decisively to protect the company's future", Chief Executive Officer Daniel Lamarre said.
"I look forward to rebuilding our operations and coming together to once again create the magical spectacle that is Cirque du Soleil for our millions of fans worldwide".
Cirque is drowning in almost $1 billion in debt, according to multiple reports.
The current Quebec government, headed by a nationalist centre-right party, came to power on a pledge to do more to prevent foreign takeovers of the province's marquee brands.
A group of shareholders - which includes private equity firm TPG, Chinese conglomerate Fosun and Investissement Quebec - will initially acquire company assets in exchange for providing $300 million in liquidity as the restructuring venture seeks other investors. Its profits were estimated at US$155 million.
The firm had to pause production of all of its shows, including six in Las Vegas, back in March.
Cirque du Soleil shows in Austin, Texas, Chicago, Houston, New Orleans, Salt Lake City, Montreal, Boston, Tel Aviv, Meloneras, Spain, Munich, Costa Mesa, California, Denver, and the Australian cities of Melbourne, Adelaide and Perth were also cancelled.