Cirque du Soleil Leaps into an Acquisition


July 7, 2017

Cirque du Soleil has broadened its horizon and moved beyond just being a circus arts company. The Canadian company, together with its private equity owner TPG, announced an acquisition of Blue Man Productions. The group is expected to have other targets in its bold acquisition list, as it wants to expand its grip as a global entertainment group.


The acrobatic deal remains secretive


Most of the details of the deal remain hidden, as neither party gave a detailed account of what has happened. Daniel Lamarre, president and CEO of Cirque du Soleil, has hinted in interviews that the deal is worth tens of millions of dollars, without giving away any specifics.


Lamarre also said in a statement, “We want to broaden our horizons, develop new forms of entertainment, reach out to new audiences and expand our own creative capabilities”.


Furthermore, Lamarre said during an interview in CNBC’s Closing Bell how “the Blue Man Group deserve the support of an organisation like ours to continue to grow around the world”.


The acquisition is likely to help Cirque du Soleil expand its audience base. Blue Man Group has six productions in New York, Boston, Las Vegas, Chicago, Orlando and Berlin, along with two touring productions going around the world. Therefore, it provides added exposure for the Canadian circus art group.


Lamarre told CNBC, “What it means is that now, we’re no longer only a circus company, but now, were going to become a global leader of entertainment”.


Blue Man Group’s interactive live shows are full of music and comedy, even though spoken words are not uttered during the shows. The company, owned by co-founders Chris Wink and Phil Stanton and the GF Capital Private Equity Fund, will expose the Cirque du Soleil brand for younger audiences.
The two groups will continue to perform under their own brand names.


Are there more deals in the pipeline?


The Canadian group was purchased two years ago in a deal that valued the group at a reported $1.5 billion. Private equity group TPG took a majority stake with Chinese investment firm Fosun Industrial Holdings and Canadian pension fund Caisse de depot et placement du Quebec also taking a slice of the investment pie.


Since the deal, Cirque du Soleil has taken a more aggressive approach to expanding and growing. The new acquisition is unlikely to remain the last – according to the reports, the current deal is one of many in the company’s target list of suitable acquisitions.


Indeed, the group will grow its portfolio in November when it enters into a partnership with the US National Football League (NFL). Furthermore, the brand is also starting a tour in China, with a longer residency in Hangzhou.


According to Bloomberg, the company wants to ensure its revenue stream is more diversified. It currently makes 80 to 85% from the Cirque du Soleil shows. The partnership will certainly help enhance the sources of the revenue.


It’ll now be interesting to see what target the circus group sets in its sights next.

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