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Tue 12 Aug 2008 05:58 PM

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Dubai buys a piece of the action

Two prominent Dubai companies have acquired a 20% stake in Canadian entertainment giant Cirque du Soleil.

Two prominent Dubai companies have acquired a 20% stake in Canadian entertainment giant Cirque du Soleil.

The deal, announced earlier this month, follows Cirque's aims to boost its worldwide empire, starting with a new permanent show to be housed at Dubai’s Palm Jumeirah.

Istithmar World, the investment arm of Dubai World, and real estate developer Nakheel each purchased a 10% share in Cirque for an undisclosed figure.

Under the terms of the agreement, the remainder of the business will continue to be owned by Cirque du Soleil’s founder, Guy Laliberte, and his team.

Nakheel and Cirque du Soleil announced a 15-year partnership in May 2007, to develop a permanent show on Palm Jumeirah. The two organisations will jointly design and build an 1800-seat theatre to house the first ever Cirque resident show to be staged outside of the US and the Far East.

In addition to establishing a permanent theatre in Dubai, Cirque will open a show production office, a ticketing company and a technical equipment and set design rental company.

Designs for the theatre are underway, as are plans for the custom-produced show. Palm Jumeirah will also host Cirque du Soleil’s world famous touring show Alegria in March 2009, as a prelude to the permanent show, which is due to open on the island in mid 2011.

Outlining the strategic significance of the partnership, David Jackson, CEO of Istithmar World Capital said, “Cirque du Soleil marks Istithmar World’s first foray into the live entertainment space, which is a key to our media focus. As a longstanding market leader in the live entertainment segment, Cirque du Soleil represents the ideal platform for Istithmar World to fuse its strong investment network into a highly focused and dynamic institution, with tremendous scope for growth across markets.

“Besides being a global tourist hub, Dubai is home to one of the fastest growing entertainment and media markets in the world, presenting a huge opportunity for such world-class cultural and entertainment facilities to add to the emirate’s rich tourism and leisure offerings. This partnership comes in line with Istithmar World’s strategy of realising the true growth and expansion potential of portfolio companies, as it continues to diversify and strengthen its private equity initiatives.”

Guy Laliberte, founder and principal shareholder of Cirque du Soleil said, “This partnership is a unique opportunity that puts forward the dream I have forged for Cirque du Soleil to continue at another level. We have found the right partners in our long-term growth in the form of Dubai World and this marks a watershed moment in our evolution. With this partnership, I can retain control of my business with the support and input of a partner that is recognised and highly respected throughout the world.

“This partnership is the best of both worlds for me and my management team; we can keep control of our creative challenges and operations while accelerating our growth doing projects all over the world. The opportunity to be involved in an entertainment project of this scale in conjunction with the resources of Istithmar World and Nakheel is extremely exciting for all of us at Cirque du Soleil,” Laliberte said.

Chris O’Donnell CEO of Nakheel said, “Cirque du Soleil shows have always been major draws in attracting tourists from all over the world to such global leisure destinations as Las Vegas and Macau. The company’s touring show, which was performed here in Dubai last year, was one of the most successful single entertainment projects ever to be staged in the region and we are excited about welcoming a new touring show Alegria in Spring next year. We are also confident that an original show and a brand new purpose-built venue on Palm Jumeirah will capture the imagination and provide a further draw for tourists around the world to visit Dubai.”

Cirque du Soleil is currently producing 18 unique shows globally for 2008, including new permanently based shows in Macau, Tokyo and Las Vegas, slated to open later this year.

Its Quidam show in 2007, was among the most successful single entertainment projects ever to be staged in Dubai, with more than 100,000 people attending the month-long run at Nakheel’s Ibn Battuta Mall.

Cirque du Soleil has annual sales in excess of US $700 million and attracts nearly 10 million visitors a year, making it one of the world’s largest entertainment businesses.

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