United Travel Pte. Ltd. is a Singapore-based tour operator. Heritage Expeditions is a family-owned New Zealand company that operates the 140-passenger Heritage Adventurer and the 18-passenger Heritage Explorer, and Nordic Hamburg is a ship owning and ship management company.
$1m on the closing date and future travel opportunities for customers
United Travel Pte. Ltd. has agreed to pay $1m for Vantage's assets on the closing date of the proposed sale — by Aug. 11 — and to provide customers with future travel opportunities.
Against this $1m, the purchaser may credit bid the outstanding balance of post-petition loans to be made to Vantage pursuant to proposed debtor-in-possession financing arrangements and to pay additional future consideration based on a percentage of gross revenues generated by the purchaser over a five-year period commencing Jan. 1, 2024.
Boston-based Vantage filed for Chapter 11 in the US Bankruptcy Court for the District of Massachusetts. The company seeks customary relief from the court to preserve the status quo pending the sale, subject to any higher and better offers that may be submitted through the court-supervised sale process.
Argus Management is serving as financial advisor and Casner & Edwards LLP as legal advisor to Vantage.
Debts and customer claims
According to the Chapter 11 filing, Vantage's accounts payable debts total approximately $28.1m and claims by existing customers arising from payments for future trips are estimated at $80.3m. Claims for refunds and for amounts due with respect to trip insurance claims against Vantage's self-funded trip insurance programs total approximately $32m and $5.4m respectively.
Creditors
Major creditors include affiliates of SunStone Maritime Group, with claims for the chartered Ocean Odyssey ($3.6m) and Ocean Explorer ($3.2m), Basel-based Apollo River Management ($2.2m), Cruise Management International ($1.8m), Dan-Bunkering ($1.3m) and CMI Leisure ($1m).
Numerous other creditors have claims under $1m each, including Cairo's Sakkara Tours, Germany's Nicko Tours, Airlines Reporting Corp., Cambridge Mercantile Group, Trip Mate Insurance Agency, Japs-Olson Co., InterNile, Bryde GMBH, Akorn Jordan, iCORPS Technologies, AGA Service Co., Africa Leisure Travel, Montevideo-based Shorexplorations and PTP in Sacramento.
Purchaser agrees to provide customers credit
According to a filing, United Travel Pte. Ltd. has agreed to provide a credit to customers who bought travel before May 11, 2023 if they book a tour with the purchaser, based on the amount each future customer has paid to Vantage that hasn't been reimbursed through refund, insurance, credit card chargeback or similar sources. The amount of the credit will be equal to the lesser of the amount paid by the customer and 20% of the price of the trip purchased from Vantage, provided that the credit doesn't exceed 20% of the price of the trip bought from United Travel Pte. Ltd.
Starting on May 12, 2023, Vantage deposited all cash payments received from customers for future travel (including cash remittances from credit card processors) in a segregated account, whose balance is $2.1m.
These customer trust funds will be transferred to United Travel Pte. Ltd. at closing, when the company will determine which of the scheduled trips will operate on the scheduled timeframe. For any trip United Travel Pte. Ltd. elects not to operate on the scheduled timeframe, it will refund the customer trust funds within five business days of the closing.
Pandemic-induced losses
The Chapter 11 filing detailed how COVID-19 impacted Vantage, founded in 1983 by Hank Lewis. For many years the company had a solid reputation for operating a wide range of escorted trips catering to seniors, including land adventures and river, ocean and expedition cruises. It had served more than 500,000 travelers since founding, offering at its pre-pandemic height 65 tours and more than 500 departures annually.
Tour revenues declined from $132m in 2019 to just over $10m in 2020. At the same time, losses in 2020 alone exceeded $29m. While revenue rebounded somewhat since then, it remained well below Vantage's pre-pandemic levels, resulting in continuing losses despite attempts to downsize operations and reduce costs.
Before downsizing, Vantage employed about 70 people stateside. All but five were terminated June 20.
Chartered two new expedition ships
During the pandemic, Vantage had taken delivery of two new expedition ships, Ocean Explorer and Ocean Odyssey, which it chartered year-round from SunStone Maritime Group. In late May, those vessels went into layup in Caen, France. HRL Bahama Holdings Ltd. is the holder of a 60% interest in the entity owning Ocean Odyssey and of a 55% interest in the entity owning Ocean Explorer.
Other third-party operators of vessels marketed by Vantage are HRL European River Cruise Ventures II, the owner of river vessel Splendor, and HRL River Cruise Venture III, the owner of river vessel Venture.
In August 2021, Vantage had engaged the Gordian Group to find sources of financing or buyers with the goal of being able to operate tours that had been paid for, in whole or in part, by customers. A transaction with a prospective purchaser was not completed.
Consumer complaints and lawsuit
The Massachusetts Attorney General’s Office reportedly received at least 818 complaints about Vantage since Jan. 1, 2020, including 181 or so filed this year. Recently the Pennsylvania attorney general sued the company, alleging it engaged in deceptive and unfair business practices by taking large sums of money from consumers then failing to provide refunds when they could not travel.
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