An international cruise company has collapsed, going into liquidation following the cancellation of cruises and the Federal Court seizure of a vessel.
Despite the vessel’s sale, a report filed by liquidators reveals customers are unlikely to see any reimbursement for their cancelled trips.
Island Escape Cruises (NZ) Limited traded for less than a year before falling into financial difficulty.
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The company, and its Australian-based subsidiary, is owned by Norway-based Pacific Exploring Limited (PEL).
The Australian branch of Island Escape Cruises went into liquidation in October 2022.
The New Zealand company was acquired by PEL in 2019 and a specialist 53m-long, 32 passenger cruise ship was commissioned.
It was delivered in October 2021 and the company began trading from January 2022.
The company primarily operated around Fiordland in New Zealand but also offered some cruises in Kimberley, Western Australia.
The cancellation of cruises began from July 2022, coinciding with the resignation of key staff members.
Australian customers lost a total of $4.6 million to the company, while New Zealand customers lost $1.5 million.
Island Escape Cruises NZ had a ship management contract with OSM Offshore AS (OSM), which served the former with a statutory demand in July 2022.
In August 2022, the company’s cruise ship was located in Broome and seized by an Admiralty Marshal appointed by the Federal Court of Australia. It was later sold for $US5.5 million.
The company then went into receivership, as did PEL.
On May 5 this year, Rowan John Chapman and Amanda-Jane Atkins were appointed as liquidators.
At the date of liquidation, the entire group owed over $20 million to its financiers.
The sale of the ship, understood to be well below-market, means there will be a major shortfall in funds needed to repay the company’s debts.
Given this shortfall, the liquidation report said customers are unlikely to see any reimbursement for their cancelled cruises.