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Genting Hong Kong files for liquidation amid German lawsuit

Genting Hong Kong files for liquidation amid German lawsuit

The Hong Kong skyline from on board the Genting Cruise Lines Genting Dream while berthed in Hong Kong on Wednesday, July 28, 2021.

Lam Yik | Bloomberg | Getty Images

Cruise operator Genting Hong Kong said Wednesday it has filed to wind up the company, as its cash is set to run out by end of January.

It comes on the heels of warnings last week from the company that it could face potential cross-defaults on financing arrangements worth $2.8 billion, as a result of the insolvency of its German shipbuilding subsidiary MV Werften.

In a filing to the Hong Kong exchange on Wednesday, Genting said the company will “imminently be unable to pay its debts as they fall due,” as liquidity dries up.

The embattled cruise operator said it filed the application to wind up the company at the Supreme Court of Bermuda, after the company “exhausted all reasonable efforts to negotiate with the relevant counterparties under its financing arrangements.”

Genting Hong Kong is part of a bigger conglomerate that also includes Genting Malaysia and Genting Singapore. Among its assets, the conglomerate owns the Resorts World leisure park chain, which includes those in Singapore, New York City, and the United Kingdom. It also has 30 casinos across the U.K.

The company, controlled by Malaysian tycoon Lim Kok Thay, has been hard hit by the Covid-19 pandemic as travel came to a standstill.

Legal battle in Germany

Genting Hong Kong was in the middle of legal proceedings with a regional government in Germany to drawdown a $88 million backstop facility – or backup funding for a secondary source of repayment – that’s related to MV Werften.

But in a ruling this week, the German federal state of Mecklenburg-Vorpommern rejected Genting’s application to access the $88 million, according to Genting’s filing earlier this week.

By : ILIAS ELABDI Date : January 19, 2022 Category : Travel News & Insights Comments :

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