The developing story of the past week is, of course, the situation around Asian Cruise Giant Genting Hong Kong. The owner of cruise lines such as Dream Cruises, Star Cruises, and ultra-luxury cruise line Crystal Cruises filed for winding up the company last week.
Since then, various rumors have come out around the future of the different cruise lines. We look back at what has been happening and how the story is unfolding today.
What Happened to Genting Hong Kong?
On January 18, Genting Hong Kong filed for winding up the company with the Supreme Court of Bermuda. Genting Hong Kong owns three cruise lines, a shipyard, various resorts, and several casinos worldwide.
It became clear Genting would default on $2.8 billion of financing arrangements in the past weeks. Most of thiswas due to financial arrangementse blocked by the German federal state of Mecklenburg-Vorpommern for debts payments of the company’s shipyard MV Werften.
As cash runs out, it could be the end for several cruise lines as the company warns that most operations could cease to exist. While bankruptcy would have been an option, it looks as the company is now heading to a restructuring rather than liquidation.
Lilla Zuill, the lawyer representing Genting, told the courts in Bermuda that a restructuring would be a “better outcome for creditors than a liquidation”. The court appointed joint provisional liquidators to facilitate and assist the company in developing and proposing a restructuring of the group’s financial indebtedness to continue as a company.
The appointment of the liquidators will be seen as good news by the Genting board of directors: “The board believes that the appointment of provisional liquidators is essential, and in the interests of the company, its shareholders and its creditors, in order to maximize the chance of success of the financial restructuring and to provide a moratorium on claims and to seek to avoid a disorderly liquidation of the company by any of its creditors,” CEO Tan Sri Lim Kok Thay said just days before he resigned his position.
Rumors on Crystal Cruises Purchase Begin
The appointment of liquidators also draws into doubt any rumors that have been going around regarding the sale of the various businesses Genting Hong Kong owns. For companies that want to enter the Asian cruise market, both Dream Cruises and Star Cruises are extremely valuable assets.
Crystal Cruises has a longstanding reputation and a large group of well-to-do regular guests, with several brand-new river ships, a brand-new expedition vessel, and two luxury Ocean liners, Crystal would be a target for many investors.
However, any discussion regarding the sale of Dream Cruises, Star Cruises, or Crystal Cruises will be confidential during the process that liquidators Alex Whittaker, Edward Middleton, and Tiffany Wong have started. Should any sale be finalized, it will need to be approved by the courts first.
What About the Guests?
While the process behind Genting Hong Kong and the future of the cruise lines is undoubtedly fascinating, many people will be wondering how guests are protected. There is good news for guests booked onboard any of the Crystal ships sailing from the US.
Federal Maritime Commissioner Louis Sola made a statement this week, saying that guests sailing from a US port will be fully protected by the Federal Maritime Commission. At the same time, Crystal Cruises also has sufficient funds to provide refunds:
“Customers who bought a voyage embarking from a US port have consumer protection safeguards in place by the FMC. Crystal Cruises has sufficient funds to provide refunds for qualifying individuals.”
“While consumers might not be able to recover all costs associated with taking a cruise, such as airfare and hotel expenses, they can take comfort that they are protected from losing the money for their cruise ticket as the law requires.”
Crystal Serenity Voyage Cut Short
This will certainly be welcome news for many guests who saw their cruises canceled, some who even had their World Cruise canceled shortly after departure. Crystal Serenity guests boarded the vessel for a 116-day world cruise on January 17, yet were told their voyage would end on January 30 in Aruba.
“Well, they say history repeats itself. I was not able to finish the 2020 World cruise and now on day three of this world cruise Crystal goes bankrupt,” Steven Shulem posted on Facebook. “We will all be off the ship next week and have our fingers crossed that someone will buy them, and we can all return to one of our favorite cruise lines.”
Crystal Symphony Update
As for guests onboard Crystal Symphony, they were diverted to Bimini in the Bahamas this week after a Miami-based judge placed an arrest warrant on the vessel. Crystal Cruises has been sued for back payments on fuel supplies, amounting to millions of dollars.
Some guests had to take a ferry back to Port Everglades, Fort Lauderdale, while other guests had to find their own transportation back to the United States.
Crystal Endeavour Update
Crystal Endeavour, the company’s newest ship, operating in Antarctica will be completing its current voyage and return to Ushuaia in Argentina on February 4. All Crystal voyages onboard all three ships have been suspended through April 29, 2022.
Crystal states on its website that it will provide a full refund of the cruise fare paid, which will be processed automatically to the original form of payment. If the cruise was paid via a Future Cruise Payment or Credit, the total value would be returned to their Crystal Society profile account.
What About Dream Cruises and Star Cruises
For guests onboard Dream Cruises ships from Hong Kong, the cruise line still says it will be starting operations again on February 4. Cruises in Singapore are still ongoing, and there are currently no plans to cease those operations.
However, Genting did halt all bookings for all voyages for Dream Cruises last week. The company did the same for Star Cruises, which is currently not operational with its vessels.