Las Vegas Bankruptcy Lawyer Erik Severino and staff write: Cirque du Soleil Bankruptcy Eminent
Nevada is projected to be one of the hardest hit states financially by the spread of COVID-19. Cirque du Soleil, which has six shows on the strip, recently had to lay off 95% of their employees. The majority of these are in Las Vegas. Over 1500 employees.
However, Cirque du Soleil was already in economic distress before the pandemic started. These existing debts, combined with quarantine measures closing their shows for the time being. After the COVID-19 Pandemic, potential customers will have less disposable income. Chances are, both Cirque and residents of Nevada may be facing possible bankruptcy even after things are back to “normal”.
Cirque du Soleil had just recently gone through a huge transition before the spread of coronavirus. The company’s founder, Guy Laliberte, sold 90% of the company to a trio of investment groups for $1.5 billion in 2015. In February 2020, he sold the remaining 10%. The company began to flounder under new management, taking out high-risk loans and stifling the show creators’ creativity. Many of their shows were rumored to be operating at a loss, including R.U.N. This show was rumored to operate at a $70 million loss and closed its curtains in early March 2020.
Cirque Faced Financial Problems Prior to COVID-19
Cirque du Soleil was already rumored to be facing $900 million in debt before all this started. If the company is able to survive, it will likely have to cut some of the shows in its lineup. It also will have to refund millions in pre-sold tickets to customers for shows that won’t happen due to coronavirus. It is unclear whether the Cirque du Soleil layoffs were temporary or permanent, but they didn’t use the word “furlough” like many companies who intend to rehire their staff once the pandemic ends. This company has highly specialized employees who can’t be easily replaced.
It is sad to know how many small mom and pop businesses in Las Vegas, Henderson, and Summerlin will likely have to close due to the spread of COVID-19. While it’s hard to feel bad for the people at the top of large businesses who make millions, the closure of large businesses will also affect thousands of employees. It is unsure if there will still be a Cirque du Soleil when things get back to normal. However, filing bankruptcy may allow them to restructure their debt and survive the crisis.
Las Vegas Residents Feeling Coronavirus Impact
Many residents in Las Vegas are currently unemployed and worried. COVID-19 has made 2020 a year to remember. However, debt relief is just a phone call away. Contact our Nevada bankruptcy attorneys today. If you are in need of stopping creditors or wanting a “Fresh Start“, call our Las Vegas bankruptcy law firm today. 702-370-0155.