MORE TIME TravelBrands seeks further extension of Stay Period

Posted on 12/01/2015

TravelBrands Inc. announced yesterday that it has filed materials requesting an extension of the stay of proceedings from the Ontario Superior court of Justice under the Companies' Creditors Arrangement Act (CCAA) until February 29, 2016.

The extension of the Stay Period will allow TravelBrands to continue to operate its business as it moves towards exiting from CCAA protection, and provides it the time necessary to resolve a disputed claim from Gibralt Capital Corporation. Gibralt, is the majority shareholder of Skyservice  though curiously neither name appeared on the initial creditors list. A hearing date to determine the validity of the Gibralt Claim has been set by the Court for January 5, 2016, which occurs after the expiration of the current Stay Period.

TravelBrands is confident that the Company will receive a favorable outcome from the Court at the hearing on January 5, 2016. TravelBrands would then exit CCAA via its Plan of Compromise or Arrangement which would see all Affected Creditors paid in full, and which was approved at a Meeting of Affected Creditors on October 30, 2015. However, if the disputed Gibralt Claim cannot be adequately resolved, TravelBrands may revisit whether it is necessary to revoke the Plan and seek the Court's approval of a sale process or credit bid. The Court-appointed Monitor, KPMG Inc., continues to oversee the business and financial affairs of the Company and supports the extension of the Stay Period. Additional information regarding the Company's proceedings under the CCAA, including court materials and the Plan, are publicly available on the Monitor's website at www.kpmg.com/ca/travelbrands.

In early November, TravelBrands made personnel cuts across the system reportedly to “streamline and centralize” its business model. Several long-time employees were let go. Twenty-five people were released in Toronto, eight in Montreal and three in Vancouver. TravelBrands operates under several wholesale and retail brands, including, among others: Sunquest, BelAir Travel, Wholesale Travel Group, Last Minute Club, Holiday House, FunSun Vacations, Encore Cruises, Boomerang Tours, ALBATours, Exotik Tours, Intair, Network and Carte Postale.