TPG Looks to Expand Cirque du Soleil East

The firm leads a private equity group in the reported $1.5B purchase of Cirque du Soleil

Adding value to TPG’s latest entertainment portfolio company, Cirque du Soleil, will involve a big push in China and a collaboration with blockbuster movie director James Cameron.

In March, Cirque du Soleil, the international performance group with shows in over 18 countries, sold a majority stake to a private equity group led by Fort Worth, Texas–based TPG and including Canada’s Caisse de depot et placement du Québec and China’s Fosun Group.

“TPG believes there is tremendous opportunity to build upon what Cirque has created over the last 30 years,” TPG partner David Trujillo tells Privcap. “TPG has a long track record of investing in Asia, and together with Fosun, we believe we can help grow the business in Asia, especially in China.”

The investment is reported to be valued at $1.5B.

“After 30 years building the Cirque du Soleil brand, we have now found the right partners in TPG, Fosun, and the Caisse to take [it] forward to the next stage in its evolution as a company founded on the conviction that the arts and business together can contribute to making a better world,” says Guy Laliberté, the founder and creative director of Cirque du Soleil.

TPG has a strong presence in the entertainment and media sectors, with portfolio companies including Univision, STX Entertainment, and Creative Artists Agency (CAA), among others. The firm has also been successfully investing in Chinese companies for more than 20 years, including Chindex International, China Grand Auto, Masan Group, Shenzhen Development Bank, and Shriram Transport.

“Expanding into China makes sense for many reasons,” Trujillo says. “With a population of over 1.3B, it is the largest consumer market in the world, with a growing middle class and increasing discretionary income.… We believe the Cirque brand of entertainment resonates with Chinese consumers. With a strong local partner in Fosun, we are confident that Cirque can gain a foothold in this key market.”

The company will still be headquartered in Montreal, where it was originally founded, and will maintain its creative team and training facilities there.

“This is an important moment in the history of the Cirque,” Caisse president Michael Sabia says in a statement. “Today, we are partnering with the company as it seeks to conquer new markets. We are confident that TPG, alongside Fosun, has all the expertise to expand the Cirque’s global presence.”

Trujillo says Fosun, in particular, made sense as a partner in a China-facing investment.

“Fosun has a strong track record of facilitating the growth of Western brands in China, with particular experience in the entertainment and hospitality sectors,” he says. He offers as an example of Fosun’s ability to bring brands to China its successful investment and strategic partnership with Club Med resorts. The firm has been able to help the company accelerate the execution of its development strategy in China by leveraging its strengths in nationwide channels, media resources, and local connections, he adds.

Aside from viewing Cirque as an excellent investment, the partners at TPG are fans of the brand and, through its ownership of CAA, have a personal connection to one of Cirque’s most ambitious shows: the upcoming Toruk: The First Flight, inspired by James Cameron’s Avatar.

“I and the entire TPG/Fosun team are longtime fans of Cirque du Soleil,” says Trujillo. He adds that the collaboration between Cameron and Cirque was facilitated through Hollywood power broker CAA—a TPG portfolio company that has a long-standing relationship with the Titanic director and the entertainment company.

“Throughout the diligence process, CAA gave us a unique lens on the company, and we expect our investment in [the power broker] to provide further value-add opportunities to Cirque in the future,” Trujillo adds.