An arrest warrant has been issued for Crystal Symphony over unpaid fuel bills after the parent company of Crystal Cruises, Genting Hong Kong, declared bankruptcy.
Crystal Symphony’s Caribbean cruise has ended early in Bimini, the Bahamas, while the rest of the Crystal Cruises fleet has ceased operations.
Crystal Cruises has ceased operations for its two ocean-going ships, Crystal Symphony and Crystal Serenity, and one expedition ship, Crystal Endeavour, through April 29th, with river cruises on hold through the end of May.
Genting Hong Kong owns the Crystal, Star and Dream Cruises brands, as well as the shipyard MV Werften, which also announced its insolvency earlier this month.
Genting Hong Kong this week warned investors cash would run out by the end of January, as the company said it had exhausted all efforts for fundraising.
The move came several months after the group indicated that it was facing an increasingly difficult cash-flow environment.
Genting now says it has “exhausted all reasonable efforts to negotiate with the relevant counterparties under its financing arrangements.”
In its bankruptcy filing, Genting indicated that certain operations would continue, including Dream Cruises, as it aims to “preserve and protect the core assets and maintain the value of the Group.”
“However, it is anticipated that majority of the Group’s existing operations will cease to operate,” the filing added.
Crystal Cruises, meanwhile, has said that it hopes for its pause in operations to be temporary, and apologised to guests affected by the development.
“This was an extremely difficult decision but a prudent one given the current business environment and recent developments with our parent company, Genting Hong Kong,” said Jack Anderson, President, CrystalCruises.
“Crystal has been synonymous with luxury cruising for more than 30 years and we look forward to welcoming back our valued guests when we resume our operations,” he added.
“We wish to thank our guests and travel advisors for their incredible support during these ongoing challenging times,” he said.
Crystal said it will provide a full refund of cruise fare paid on affected bookings. Refunds will be processed automatically to the original form of payment so there is no further action on the guest’s part.
What now for Crystal Cruises?
Writing for The Points Guy, Gene Sloan called Crystal Cruises the best luxury cruise line in the world, and analysed the future outlook for the cruise line.
He points out that in the filing, Genting suggested the liquidators would pursue a financial restructuring that could keep at least parts of the company running, but would also be able to “dispose of all or certain of the company’s assets with a view to maximizing value and returns for creditors.”
“That could mean that Crystal resumes operations as a division of a restructured Genting Hong Kong. It also could mean it resumes operations under the ownership of another cruise company, hedge fund or other entity that buys it during the liquidation process,” says Sloan.
“It also could mean the brand is shut down completely or sees some of its eight vessels sold off for cash to interested buyers,” he added.
The best outcome for the brand is for Genting Hong Kong, or an outside investor, to see its value and move to keep the cruise line intact, hopefully with another company, similar to Royal Caribbean’s purchase of Silversea.