Genting Hong Kong Restructuring - Potentially Star Cruises, Dream Cruises and Crystal Cruises Impacted.
|Dream Cruises Ship Part of Genting Group Hong Kong|
Genting Hong Kong has suspended all payments to creditors, sparking a 33% drop in the company’s share price. Genting cited COVID-19’s impact on its operations — which include Dream Cruises, Star Cruises and Crystal Cruises — for the cash crunch, in a statement to the Hong Kong stock exchange Wednesday night.
‘The Group has undertaken a number of cost reduction and cash conservation measures to mitigate the effects of the resultant loss of revenues from its operations,’ the statement said. The company owed a total of $3.4bn as of July 31.
Bank fees due on newbuilds
On August 17, Dream Global One Ltd and Dream Global Two Ltd (subsidiaries of Genting HK) were required to pay bank fees amounting to €3.7m in connection with the financing of the construction of ‘certain ships’, said the company statement. Those fees were not paid.
Earlier this month Genting warned of a year delay in deliveries of Crystal Endeavor and Global Dream both under construction at own yards MV Werften and severely restricted operations and revenue generation at entertainment and leisure businesses Resorts World Manila and Zouk, Singapore.
In late July, Dream Cruises did return to service with Explorer Dream on short sailings from Taiwan for the local market.
Genting HK said it will use its available funds to maintain critical services for the company’s operations and asked creditors to form a steering committee to evaluate a planned restructuring proposal.
Analysts in Asia were suggesting Genting may look to sell assets, or possibly liquidate the entire company.
The Genting Group is the parent company of Crystal Cruises, Dream Cruises and Star Cruises. Crystal Cruises has already stated that they are NOT impacted by the reorganization.
Crystal issued a statement late last Thursday to calm fears about its viability as parent Genting Hong Kong pursues a restructuring.
'Committed to honoring contractual obligations'
'It is important to understand that the company is not going out of business,' the statement said. 'Whatever option our parent company pursues, it will allow Crystal to operate its business. Additionally, we have always been committed to honoring our contractual obligations with guests and travel partners, including the processing of refunds.
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