What will CDS look like as it recovers from near-death experience?

Cirque du Soleil is slowly but surely returning to life, though it’s still very much in an identity crisis.

The most famous modern-day circus came close to disappearing in 2020. The COVID-19 pandemic dealt what could have been a mortal blow to the Montreal-based creative company, forcing it to shutter all 45 of its shows around the globe and lay off nearly 5,000 employees, which represented 95 per cent of its staff. Then it had to seek bankruptcy protection.

Those were dark days for the outfit founded in 1984 by fire breather Guy Laliberté and a ragtag group of Québécois hippies in Baie-St-Paul. The company’s revenue dropped to zero overnight, and it was unclear when the Cirque would be able to raise another big top or return to the stages of Las Vegas.

The Cirque survived, but not without a few radical changes. Following a drawn-out legal battle, the previous owners — U.S. equity firm TPG Capital, China’s Fosun International and the Caisse de dépôt et placement du Québec — lost control of the company and it was taken over by a group representing the creditors, notably including Catalyst Capital Group, Sound Point Capital, CBAM Partners and Benefit Street Partners.

Then longtime Cirque CEO Daniel Lamarre stepped down in December 2021, replaced by Stéphane Lefebvre, who was chief operating officer. Many openly wondered why the financial guy was taking over an organization that has always been about creativity and bold artistic choices.

Cirque shows are finally returning. It began last June with the reopening of Mystère and O in Vegas, and now there are five Cirque shows on stage in that city, including Kà, The Beatles Love and Michael Jackson One. There are also five touring shows, with three more to come this year. One of those is Kooza, which is set to open May 12 at the Big Top in the Old Port and run there until Aug. 14. It is the first Cirque production in Montreal since 2019.

But this is a stripped-down version of the Cirque. That’s only 13 shows in all, down from 45 before the pandemic. La question qui tue is: Where is the Cirque headed post-bankruptcy protection? And what kind of Cirque will it be?

In a recent phone interview, Lefebvre said those are precisely the questions he’s grappling with in his new job.

First off, he insists the new owners are not really having a big impact on what the Cirque is doing.

“I think this company needs to reaffirm its creative leadership,” said Lefebvre. “In certain markets we hadn’t been there for two years pre-pandemic, which means we haven’t been in certain markets for four years. So there’s a real need for us to go back and show the world, to show people in all of our markets, that we exist — that we’re relevant.”

One of the first new shows will be Mad Apple, which is set to première this month at the New York-New York Hotel and Casino in Las Vegas. This is not a traditional Cirque creation — it stars comedian Brad Williams and features a slew of songs about New York played by the house band, along with acrobatics, dance and comedy.

“MGM (which owns the New York-New York Hotel and Casino) was looking for that kind of content at the theatre, where people would stick around,” said Lefebvre. “You go there, you have an amazing experience before the show and you stick around after the show. We’ll have some DJs. … It’s a richer experience before and after the show.

“It does have acrobatic acts in there, but it won’t be competing with our other shows in Vegas.”

The little secret behind the Cirque’s near-death experience is that while the company was dealt a ferocious blow by the pandemic, it was already in big trouble before there was a single COVID case in North America. Many believe the major issues started when Laliberté sold the company in 2015 for US$1.5 billion to the consortium that included TPG Capital, Fosun and the Caisse. They started creating more and more content, which critics felt watered down the Cirque’s brand.

In 2020, Cirque co-founder Gilles Ste-Croix told the Montreal Gazette things changed when Laliberté sold.

“Already last year we could see that there were some problems,” Ste-Croix said at the time. “They were putting out many, many shows, and a couple of them didn’t work out.

“It was a question of how they were going about the development. Having so many shows out on the road … demands lots of money to finance, hoping to make a buck out of it. But it didn’t work out that way, and they were, I’d say, stretching to finance all this debt — and finally COVID came and it stopped all the revenue.”

A source close to the creditors group that took over the Cirque told the Gazette in 2020 that the Cirque’s debt increased from $300 million to $1.2 billion in the five years following Laliberté’s sale. There were also a few high-profile failures in that period, most notably R.U.N, a Vegas show that was supposed to be permanent but closed in less than five months and cost investors $60 million.

“This company took some risks pre-pandemic, and some worked and some didn’t,” said Lefebvre. “Just to be clear, if there was no pandemic, I don’t think the company would have gone through this (bankruptcy protection) process. I don’t think this was ever an option. It was all due to COVID.

“We had some success. We had some good acquisitions. But we did some shows that didn’t work. … We have to learn from that. I think it’s the way we manage risk. This company has to take creative risks, but within some financial boundaries. And that’s something we learned … so not spending too much money on something that is further from our core business.”

In the end, it’s about recreating the magic that first turned people on to the Cirque, and everyone including Lefebvre knows that is harder to do today. People already know what the Cirque is, and they also have more entertainment options than ever before.

“People have changed their relationship to entertainment throughout the pandemic, rightly or wrongly,” said Lefebvre. “People have become familiar with certain types of media … people have got used to consuming entertainment through Netflix and other platforms. And people have seen amazing things.

“At the Cirque, we need to be more creative than we’ve ever been. I was talking to our employees and the creative production team recently about innovation. Innovation doesn’t just mean technology — it’s this idea of coming up with new experiences. So people would see with a new production things on stage that would be new, not something people have seen at Cirque du Soleil many times in the past. It’s about giving people a richer experience.”

{ SOURCE: Brendan Kelley, Montreal Gazette }