For a number of reasons – a weaker £, concerns over safety, etc., – travel industry insolvencies are considered likely to increase in 2017. When Insolvency happens in the Travel Industry, speed of reaction from all parties concerned, including the insolvency practitioner, is of primary importance. This is because the insolvency often means that holiday makers can be stranded overseas, whilst working out to do with those forward bookers who are yet to travel is just as important.
Selsdon Travel Limited
The failure of Croydon based Selsdon Travel which traded as Dreamticket lead to 600 holidaymakers being stranded abroad. They were able to complete their holiday as a result of the CAA being able to guarantee payment to the hoteliers. In addition, the airlines were committed to fly them home through their membership of IATA.
There were also 4,000 customers who had yet to travel. These forward bookings, together with the customer databases were sold shortly after our appointment, boosting the funds available for creditors and minimising disruption.
Other recoveries and the reduction of potential claims lead to preferential claims being paid in full. It is likely that there will be a small distribution to unsecured creditors.
· Pinnacle Travel Limited
Pinnacle Travel Limited specialised in school skiing trips and was ATOL regulated. The forward bookings and customer database were sold out of administration through a ‘pre-pack administration’. The success of this depended on a short but aggressive marketing campaign using our contacts in the industry and good communication with the secured creditor.
There was little or no disruption to the school trips. Preferential creditors were paid in full and unsecured creditors received a small dividend.
