Renaissance Cruises Ceases Operations

September 30, 2001
Renaissance Cruises halted all operations on September 25. The 10-ship cruise line, with eight contemporary 684-passenger and two yacht-like 114-passenger vessels, has filed “voluntary petitions for Chapter 11 reorganization.” The company disembarked all passengers, regardless of what phase their cruise was in, and booked them on flights home. Renaissance also provided its onboard officers and crew with transportation home. In a statement Tuesday evening, Manfred Urpsrunger, Renaissance’s president and CEO, said: “In light of the severe, unexpected drop in leisure travel following the terrorist attacks on the United States and the immediate and adverse impact on the Company's late stage recapitalization efforts, we concluded that this was the only responsible action we could take to exit our business in an orderly fashion while preserving value for our investors. We want to thank our customers, travel agent partners and employees for their support over the last year, and assure them that we are taking the necessary steps to minimize the impact of this filing on them.” While Chapter 11 bankruptcy filing often means a company will continue operating under a reorganizational plan, in this case sources say this represents the final chapter of Renaissance’s financially (and otherwise) tempestuous history. Insurance Issues
The folding of Renaissance Cruises is another blow for travel insurers this month -- particularly those whose policies cover passengers should a tour operator or cruise line cease operating. According to CSA, which does provide this coverage, Renaissance customers who paid by credit card should immediately contact their credit card company, then also request a claim form from their insurers. Those who paid by check or cash, a method of payment we never, ever recommend unless you take out travel insurance, should immediately file a claim with their insurance operator. Typically exempt from any kind of coverage should a company halt operations is that which is purchased through the cruise line itself. Also, unusually, Renaissance passengers are not covered by the Federal Maritime Commission -- often a source of last resort for passengers who paid by cash or check and have purchased no insurance policy coverage for business failure. The FMC requires cruise lines that call at American ports to post a bond but none of Renaissance’s ten ships qualify. Status of Ships
Renaissance Cruises has revealed the debt it faces as $110 million in passenger claims, $75 million in supplier claims and -- here’s the mammoth one -- $1.1 billion owed in relation to the ships themselves. The latest? * Renaissance has relinquished 8 out of 10 ships. Currently, the fleet is under the control of a group of French banks. Most, with the aid of skeleton crews, are being sailed to Gibraltar where they will be held for the time being. Some ships have been detained -- notably one that’s been ceased in Dover for debt to the port’s shipping agency -- and some are on their way. * The other two are in Tahiti and due to the legal agreement Renaissance had with the French government (the cruise line received funding assistance for those two ships from France) they cannot sail off without permission. The ships, according to sources, have been seized by port authorities in Papeete, Tahiti, over $1 million in unpaid fuel bills. * They may not need to, anyway, because reports indicate that R3 and R4, the ships that sail Tahiti (and were not part of the 8 that are being sent to Gibraltar), may resurface; Renaissance representatives are negotiating with possible financiers to resume sailing. Sources say an announcement could be made as early this week. This effort, according to the company’s bankruptcy lawyers, is a front-burner project in terms of any possibility of getting the company up and running again. *The banks now controlling Renaissance have said that crew will be paid for the month of September. Offers for Renaissance Guests
Other cruise lines, like Silversea Cruises, Royal Caribbean and Celebrity Cruises are offering discounts and shipboard credits for displaced Renaissance Guests. Silversea will reduce its published cruise-only fare by 100 percent of the Renaissance cruise-only fare on any new 2001 or 2002 Silversea voyage. Passengers must provide proof they had a Renaissance cruise booked and paid for to take advantage of the savings offer. Interested passengers can contact their travel agents or Silversea Cruises at (800) 774-9996. Any guest with proof of a Renaissance passage who books a cruise on Royal Caribbean or Celebrity by October 31 will get an onboard credit that varies from $25 per guest for two - five night cruises, $50 for a week’s voyage, and $75 for one lasting ten or more nights. Renaissance booking confirmations can be faxed to 1-800-RCCL-FAX to receive the shipboard credit.