SVP will acquire majority ownership of Hornblower and provide a significant equity investment with Crestview Partners retaining a significant minority and becoming the sole owner of Australia travel provider Journey Beyond.
The agreement provides for Hornblower to receive $121m in new-money financing from SVP-managed funds and Crestview, and the company’s total debt will be reduced by approximately $720m.
AQV sale or wind-down
As part of the agreement, AQV — which ceased operations Tuesday — will be sold or, if a sale cannot be achieved, its operations will be wound down. Hornblower said the overnight cruise operation had underperformed and not recovered from the pandemic.
'It is most unfortunate that, despite great efforts by our team, crew and partners, AQV has been unable to fully rebound from the effects of the pandemic,' Hornblower Group President Adam Peakes said in a statement provided to Seatrade Cruise News.
He added the shutdown decision 'was not made lightly. We are deeply proud of our employees and crew for the outstanding services they have provided our guests over the years. As the backbone of the AQV experience we extend our deepest appreciation to our team for their unwavering commitment, passion and hard work, which has been exceptional. We would also like to express our heartfelt gratitude to our guests, partners, agents and the local communities where we call who have each been integral to our journey.'
Outside of AQV, Hornblower’s current services are operating as usual and will not be impacted by the transaction:
Voluntary Chapter 11
To implement the agreement and ensure AQV's orderly sale or wind-down, Hornblower and certain affiliates filed for voluntary Chapter 11 today in the US Bankruptcy Court for the Southern District of Texas. Citing the 'overwhelming support' of its investors, Hornblower expects to move through this process on an accelerated basis and emerge from Chapter 11 in approximately four months.
In connection with this process, Hornblower received a commitment for $300m in debtor-in-possession financing from Deutsche Bank Private Credit & Infrastructure to refinance its existing super-priority term loan, in addition to the $121m in new-money financing from SVP-managed funds and Crestview.
Following court approval, this new financing, combined with cash generated from ongoing operations, is expected to support the business during the court-supervised process.
More focused portfolio
Hornblower said these collective actions will enable it to move ahead with a more focused portfolio, stronger balance sheet and additional financial flexibility, well-positioned to continue driving growth in its core land- and water-based experiences businesses. It added: 'These core businesses are delivering excellent results and serving thousands of guests every day.'
'The steps we are taking today will enable us to address AQV and strengthen our financial foundation as we continue serving our guests and commuters around the world,' said Kevin Rabbitt, CEO, Hornblower Group. 'We have strong relationships with our government agency and business partners, and our core businesses are performing well with robust and growing demand.'
Passenger refunds
As earlier reported here, the company said it intends to refund passengers for canceled cruises.
Impacted customers can submit a claim at www.aqvrefunds.com. Additional information is available at www.aqvinfo.com.
Vendors and suppliers
The company said it intends to pay vendors and suppliers in full under normal terms for goods and services after the Chapter 11 filing. Unpaid debts for goods and services provided prior to the filing, known as pre-petition claims, cannot be paid without specific court approval and will be addressed as part of the court process.
Information on the court process is available at https://omniagentsolutions.com/Hornblower, a site administered by Omni Agent Solutions, the company's claims agent. Omni may be reached at 888-504-8055, or 747-263-0163 for calls originating outside the US or Canada, or by emailing [email protected].
See also Feb. 20 breaking news 'American Queen Voyages ceases operations'
