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Felix & Paul Studios Inc., the Montreal VR studio, made an assignment in bankruptcy on 10 September 2026. The studio produced Interstellar Arc, the VR attraction at AREA15 in Las Vegas. Deloitte Restructuring Inc. is the trustee.
An assignment in bankruptcy is the liquidation route under Canada’s Bankruptcy and Insolvency Act, comparable to a US Chapter 7. The company hands its assets to a licensed trustee, who sells them for its creditors.
Félix Lajeunesse founded the studio with Paul Raphaël and Stéphane Rituit in 2013.
Lajeunesse posted on LinkedIn on 24 September that Interstellar Arc “is about to relaunch at AREA15!”
Felix & Paul Studios owed about US$34.5 million at 31 July 2026, Insolvency Insider reported from the court filings on 20 September. Secured claims made up US$22.2 million of that, against assets with a book value of about US$22.1 million.
Export Development Canada, owed about US$6.3 million, and Investissement Québec, owed US$5.8 million, are the largest secured creditors. National Bank of Canada, BDC Capital, Canada Economic Development and SODEC hold the rest.
Net losses came to about US$19.2 million over the studio’s three most recent reporting periods, Insolvency Insider reported.
In a motion filed on 14 September, the trustee set out the causes the studio gave: accumulated production losses and weaker-than-expected growth in Interstellar Arc revenue. Delays to lunar missions the studio worked on added costs and pushed back revenue.
The motion adds that the cancellation of a major project in June 2026 limited the studio’s ability to raise money.
A sale process launched in July reached 76 potential buyers and investors, and 51 signed confidentiality agreements, Insolvency Insider reported. The process drew one proposal. It was non-binding, offered creditors no cash and was withdrawn on 9 August.
The trustee then asked the Quebec Superior Court to approve a US$350,000 sale. It covers assets tied to the Space Explorers franchise and the studio’s lunar camera work.
Former executives and employees of the studio formed the buyer, 18201714 Canada inc., the motion said. The court issued an approval and vesting order on 17 September, Deloitte’s case documents show.
The proceeds would cover professional fees and give secured creditors only a marginal recovery, Insolvency Insider reported. Unsecured creditors would get nothing. The first meeting of creditors is set for 28 September by videoconference.
Interstellar Arc opened at AREA15 in October 2025 and won Best Location-Based Entertainment at the 2026 Auggie Awards.
The Las Vegas Review-Journal reported on 8 September that Interstellar Arc had closed at AREA15 after less than a year. “What I’d say is, it’s done,” AREA15 chief executive Winston Fisher told the paper. “There are discussions to see if there’s ways to reopen it.”
AREA15’s Interstellar Arc page lists the 60-minute experience from $49.
For investors, the US$350,000 sale is set against US$22.2 million of secured claims. For operators, the trustee’s motion names weaker-than-expected Interstellar Arc revenue among the causes the studio gave for the bankruptcy.
Is the Felix & Paul Studios bankruptcy a Chapter 7 or a Chapter 11? It is a Canadian filing, an assignment in bankruptcy under the Bankruptcy and Insolvency Act. That is the liquidation route, the closest match to a US Chapter 7.
How much did Felix & Paul owe in the VR studio bankruptcy? About US$34.5 million at 31 July 2026, including US$22.2 million of secured claims, against assets with a book value of about US$22.1 million.
Who bought Space Explorers? 18201714 Canada inc. paid US$350,000 for assets tied to the Space Explorers franchise and the studio’s lunar camera work. The company was newly formed by former Felix & Paul executives and employees. The court issued an approval and vesting order on 17 September.
Is Interstellar Arc reopening? Co-founder Félix Lajeunesse posted on LinkedIn on 24 September that it “is about to relaunch at AREA15!” On 8 September, AREA15 chief executive Winston Fisher said there were discussions about reopening it. AREA15’s page lists the 60-minute experience from $49.
Why did Felix & Paul Studios go bankrupt? The trustee’s motion cites accumulated production losses, weaker-than-expected Interstellar Arc revenue, delays to lunar missions and a major project cancelled in June 2026.
