It’s being widely speculated that the demise of Cox & Kings is imminent following the sudden closure of its local operations last week.
The company, which was founded in 1758, once again defaulted on its payment obligation on for commercial papers on Friday, according to a BSE filing.
“The company is working closely with its lenders to optimise its asset base globally and bring the situation back to normal,” the filing said.
It was only hours before that Cox & Kings decided to shut down its Australian and New Zealand operations, taking with it Tempo Holidays and Bentours, and prompting support from other travel companies to affected agents and their clients.
Cox & Kings’ inability to repay debts and meet its financial obligations has been plaguing the company for some time now, and investors were told June that it planned to make good “through a combination of internal accruals and monetisation of assets”.
This statement suggested the company was looking to sell businesses in order to raise the money required to stay afloat and, as it turned out, Tempo Holidays and Bentours were in the mix.
In the last couple of months, there have been industry rumblings that both brands were struggling to pay their bills, and the cancellation of Tempo’s ATAS accreditation (and subsequent suspension of its CATO membership) only fuelled speculation that all was not well at Cox & Kings.
However, Travel Weekly understands neither brand was performing poorly here in Australia and New Zealand – in fact, it was quite the opposite.
Given Cox & Kings has been trotting out the same line for a while now about resolving its debts, coupled with a rumour mill in overdrive, the writing appears to be on the wall for the legacy wholesaler.
But Abercombie & Kent’s APAC managing director, Sujata Raman, said she would be surprised if the brand disappeared forever.
“I anticipate that it will be reborn in some format,” she said.
“That’s usually what happens – someone decides to take it and regenerate the brand.”
“But, certainly I think you’d have to take a close look at the business model and say, ‘Why didn’t it work?’. It would need some serious re-engineering to relaunch.”
Raman revealed that A&K has been interviewing numerous people from Tempo and Bentours in the last few weeks “who were obviously were feeling uncomfortable about the way things were panning out”.
“I feel desperately sad for the employees. It’s a horrible position to be in three months out from the end of the year,” she said.
Travel Weekly has contacted Cox & Kings for comment.