Excite Holidays executives met with accounting giant KPMG just over six weeks before the wholesaler’s collapse to gain advice about restructuring the company.
According to a letter to creditors from administrators Morgan Kelly, Phil Quinlan and Amanda Coneyworth of KPMG, Excite executive director Nicholas Stavropoulos and chief financial officer Theo Theodore met with the accounting firm on 28 November 2019 to discuss its potential provision of “restructuring advisory assistance”.
The two Excite execs then met with Kelly and Quinlan a day later to further discuss KPMG providing restructuring assistance, before the accounting firm agreed to formally help out the wholesaler on 2 December.
An initial retainer fee of $20,000 plus GST was paid to KPMG by Excite in respect of this engagement, according to the letter.
Between 2 December and 8 January, Kelly and Quinlan met with Stavropoulos and fellow Excite executive director George Papaioannou, along with Theodore, but “no deliverables were completed in respect of the engagement”.
During this time, Stavropoulos confirmed to Travel Weekly that the company was in discussions about a potential business deal, believed to be with Bonotel Exclusive Travel.
A day later, Kelly and Quinlan met with Stavropoulos, Papaioannou and Theodore to discuss the appointment of external administrators to Excite Holidays (Australia) Pty Ltd, Global Travel Holdings Pty Ltd, Global Travel Specialists Pty Ltd, Events NG Pty Ltd, and Travel Serv Co Pty Ltd. KPMG received no remuneration for this meeting.
Meanwhile, a document with an Excite Holidays letterhead has been shared with creditors by KPMG answering some of the frequently asked questions from affected travel agents.
According to the document, administrators were appointed because Excite is “unable to meet its financial commitments” in Australia.
“Due to the group’s financial position, the administrators had no option but to immediately cease operations in Australia upon appointment on 10 January 2020,” it says.
“The appointment of voluntary administrators is only to the Australian entities at this stage. As part of our urgent review, we are assessing the position in relation to the non-Australian entities.
“We understand that all global bookings are processed through the online platform and may be impacted by the voluntary administration.”
The document states that Excite’s booking platform has been suspended since 10 January 2020 and is not accepting any new bookings.
Furthermore, it notes that not all forward bookings have been paid for by Excite, and agents will be notified individually if their bookings are fully paid.
For bookings that have been pre-paid by Excite, agents will be contacted directly to provide
details of how to proceed. For all other forward bookings, agents have been advised to check the status with the service provider.
Agents will continue to be able to log in to Excite’s platform to check the status of any pre-existing bookings and are being encouraged to review each item within the booking to determine its current status.
However, agents won’t be able to cancel a booking through Excite’s platform and have been advised to contact the supplier to determine if the booking will proceed.
“To the extent that Excite Holidays has not paid the supplier for a booking you have paid for, you may be a creditor,” the document states.
However, it notes that whether affected agents are a creditor of an overseas Excite entity or one of the Australian entities subject to voluntary administration is still yet to be determined.
Furthermore, the return to creditors from the voluntary administration is “uncertain at this stage”.
“The administrations will be preparing a detailed report to creditors outlining amongst other things the potential outcome for creditors for the Australian entities,” the document days.
“This report is due to be sent to creditors on or around 6 February 2020.
“All amounts owing are currently frozen pending the outcome of the voluntary administration.”
The first creditors meeting for Excite’s collapse will take place at Sydney’s Wesley Conference Centre on 22 January at 11am (AEDT).