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Pullmantur files to reorganize under Spanish insolvency terms

CRUISE Monarch.jpg
Monarch is one of Pullmantur's three ships, along with Sovereign and Horizon
Cruises Investment Holding and Royal Caribbean Cruises Ltd. filed to reorganize their Pullmantur Cruceros joint venture under the terms of Spanish insolvency laws.

Cruises Investment Holding owns 51% of the Spanish cruise line, while RCL owns the remaining 49%.

COVID-19 made this action 'necessary'

Pullmantur's board of directors determined that COVID-19 pandemic's impact made the action necessary. Pullmantur management notified employees of the decision after filings were made with Spanish authorities.

'Despite the great progress the company made to achieve a turnaround in 2019 and its huge engagement and best efforts of its dedicated employees, the headwinds caused by the pandemic are too strong for Pullmantur to overcome without a reorganization,' the board stated.

Three ships

The company earlier canceled sailings through Nov. 15. Pullmantur operates three ships: Monarch (2,752 passengers), Sovereign (2,733 passengers) and Horizon (1,828 passengers). 

Royal Caribbean said passengers booked to sail will be offered the option to cruise with Royal Caribbean International or Celebrity Cruises. Details of the offer are to be shared with guests in the near future.

Crew are staffed at minimum maintenance levels on Pullmantur's three ships and the company said it will take care of their safe return home.

RCL impairment charge in Q1 results

RCL noted all of its assets related to the Pullmantur joint venture were included in the $1.1bn in non-cash asset impairment charges reported in the company's first quarter 2020 results.