Hebridean Cruises Seeks Buyer, Financial Support

April 9, 2009

Hebridean Cruises, which just last month abruptly announced that it would sell half of its two-ship fleet, is now facing insolvency. Effective yesterday, the cruise line has filed for administration, which means it is seeking financial resurrection in the form of a buyer. The affairs, business and property of Hebridean International Cruises Limited and Leisure and Marine Holdings Limited (which owns the line's now-only ship, Hebridean Princess) are now being managed by Ernst & Young LLP.

According to a statement on the line's Web site, no voyages aboard Hebridean Princess have been cancelled, though the Telegraph reports that Ernst & Young has only said the ship would continue this year's programme of cruises. The cruise line lists departures through November 2010 on its site. The statement further says that the company is still accepting bookings for published cruises.

To that end, passengers onboard Hebridean Princess needn't do anything -- at least at this point (it remains to be seen what impact the potential sale of the company or its ship will have on its programme). However, the filing does impact those travelers who were booked to sail on Hebridean Spirit, the sale of which was finalized on 7 April, and which will be converted into a private yacht by its Middle Eastern buyer, according to the Telegraph.

On 19 March, we reported that Hebridean would offer all booked passengers a full refund or the option to transfer to a Hebridean Princess sailing to the Western Isles of Scotland. According to a spokesman for Hebridean, the option to switch to Hebridean Princess still stands. However, passengers who were hoping to receive a refund may not be as lucky. Hebridean now says that "the Joint Administrators are not in a position to refund any customers in respect of the cancelled Hebridean Spirit cruises."

Those customers seeking a refund for a Hebridean Spirit cruise may be protected by the Air Travel Organiser's Licenses (ATOL) and should contact ATOL directly on 020 7453 6350 between 9 a.m. and 5 p.m. Monday through Friday, or visit this Web site. Customers should also check their travel insurance policy as it may cover the cancellation, though the extent of coverage (complete or partial) will vary by policy type.

So, what's next? According to the Telegraph, there's already a potential buyer; Ernst & Young declined to name names, but the paper reports that it is speculated that recently revived Swan Hellenic, now headed by Lord Sterling (formerly chairman of P&O), might swoop in to save Hebridean.

Hebridean is known for offering country-house style, all-inclusive, luxury cruises. The line has seen many illustrious passengers, including Her Majesty Queen Elizabeth II.

We'll keep you posted.

--by Melissa Baldwin Paloti, Managing Editor, with reporting by Kelly Ranson, U.K. Editor