MONTREAL -- The purchase offer for Cirque du Soleil from its secured creditors risks eliminating Quebec's longstanding presence as a shareholder and causing losses of tens of millions of dollars to two of the province's largest institutional investors.

A US$1.2-billion takeover proposal by a group of debt holders, which was approved on Friday as the benchmark bid for a court-supervised auction of the insolvent entertainment giant, would push aside the trio of current stakeholders: Quebec's pension fund manager, the Texan fund TPG Capital and the Chinese firm Fosun.

The Caisse du depot et placement du Quebec estimated in its most recent annual report that its initial 10 per cent stake, bought in 2015, was worth between $50 million and $100 million as of Dec. 31.

The Caisse scooped up another 10 per cent chunk in February from co-founder Guy Laliberte, who sold off his remaining shares just before the COVID-19 pandemic hit North America.

Court documents filed under the Companies' Creditors Arrangement Act also show that the Caisse and Quebec's Fonds de solidarite FTQ each lent Cirque US$30 million last year.

The Fonds confirmed recently it does not expect to see that money again, while the Caisse declined on Monday to disclose how much cash it stands to lose if the takeover bid goes ahead.

While the proposal includes a commitment to keep Cirque's head office in Montreal for at least five years, the province's role as a stakeholder dating back to the launch of the signature Quebec brand in 1984 would vanish.

Rival bidders will have until Aug. 18 to submit an alternative to the latest proposal, which dismisses the purchase agreement first entered into between Cirque and its current owners.

An auction will take place on Aug. 25 if necessary, with the transaction expected to close by Sept. 30.

This report by The Canadian Press was first published July 20, 2020.