Battle for control over Cirque du Soleil leads to deal with lenders

The entertainment giant filed for bankruptcy protection in June

Cirque du Soleil has accepted an offer to sell itself to its lenders in a deal that would kick its current private equity owner, TPG Capital, out of the tent, The Post has learned.

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CIRQUE DU SOLEIL FILES FOR BANKRUPTCY PROTECTION

The circus giant, known for dominating the box office in Las Vegas, OK’d the lenders’ offer on Wednesday night — marking the latest twist in a heated tug-of-war for control of the entertainment company.

The deal forgives roughly $825 million of Cirque’s $1.2 billion in outstanding loans in exchange for ownership, while leaving its current owners — a group led by billionaire private titans like David Bonderman — empty-handed.

Cirque is scheduled to present the new restructuring plan, which also includes roughly $375 million in new spending money, to a Quebec court on Friday. The judge is then expected to open the door to rival bidders who want to present superior offers, including TPG, a source close to the situation said.

CORONAVIRUS PUSHES CIRQUE DU SOLEIL TO EXPLORE OPTIONS INCLUDING BANKRUPTCY- SOURCES

The entertainment giant, known for theatrical and visually captivating acrobat acts, filed for bankruptcy protection in June after the coronavirus pandemic forced it to shutter its shows worldwide. It quickly agreed to sell itself back to its current owners, including TPG and the government of Quebec, in exchange for $400 million.

Quebec’s government, which offered $200 million of the $400 million, is not involved in the deal accepted on Wednesday, the source said.

TPG’s restructuring plan angered the lenders, a group led by Los Angeles Dodgers co-owner Todd Boehly and private equity firm Catalyst Capital Group, because it offered them a minority stake in Cirque in exchange for wiping out their $1.2 billion in debt. They immediately protested and complained to the bankruptcy judge that they were never consulted.

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As The Post exclusively reported earlier this month, the lenders were also gearing up to press the judge to oust Cirque’s longtime CEO Daniel Lamarre amid complaints that he and the rest of the board were blindly loyal to their current owners.

Then on July 1, Quebec Superior Court Judge Louis Gouin hinted that he would grill Cirque’s lawyers about the allegation that the company failed to obtain creditor approval for the TPG plan.

The Cirque deal with creditors agrees to keep current Cirque management in place, the source said.

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