Cirque unscathed in Dubai debt crisis
Last Updated: Saturday, November 28, 2009 | 10:17 AM ET
The Canadian Press
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The Cirque Du Soleil performs at the Venetian Macao-Resort-Hotel in Macau, China, in 2008. A Dubai company, deep in debt, bought a minority share in the Montreal entertainment firm. (Canadian Press)Global entertainment company Cirque du Soleil says it is unaffected by the financial high-wire act of its minority shareholder, Dubai property developer Nakheel and its related investment arm, Istithmar World Capital.
The Montreal-based acrobatic circus said it is not owed money and foresees no impact from the debt problems of the Dubai World subsidiaries.
"We had a board meeting last week and everything is business as usual," spokeswoman Renée-Claude Menard said in an email.
Dubai World, the investment company that manages businesses for the Dubai government, has sought a six-month delay on paying back its $60-billion US debt.
The government-controlled developer and its related investment arm confirmed last year that it had purchased a 20 per cent stake in the international circus touring company.
While the fallout from Dubai's debt crisis rippled across the globe Friday, it appeared Canadian companies have escaped with little or no impact.
An involuntary restructuring of Nakheel could ultimately force the sale of its interest in the Cirque. But Menard said there has been no requested change in ownership.
"We do not speculate on any type of scenarios," she added.
Sheikdom borrowed to fund construction boom
The sheikdom, ruled by Sheik Mohammed Bin Rashid Al Maktoum, borrowed $80 billion US to launch a construction boom that built the world's tallest tower, artificial islands to house the rich and famous and numerous other projects.
Cirque du Soleil founder Guy Laliberte last year said he sold one-fifth of the business for strategic reasons that would make the circus troupe financially healthier and give it a foothold in another part of the world.
In 2007, the Cirque signed a 15-year partnership to develop a permanent show on Palm Jumeirah in Dubai. There's no word still about the fate of that show.
The Cirque is one of the world's largest entertainment businesses, with annual sales estimated at more than $800 million US and a collective yearly audience of about 15 million people.
Started in 1984, the company employs more than 4,000 people in some 40 countries.
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