Megayacht News — Organizations

Yacht Path Files for Bankruptcy Protection

Yacht Path International, a prominent yacht and megayacht transport company based in Florida, and three related companies have filed for Chapter 11 bankruptcy protection.

The filing was made on March 20 as a voluntary petition, meaning Yacht Path itself submitted the request. (Companies can be forced into bankruptcy by their creditors, a situation that would be classified as an involuntary petition.) The attorney representing Yacht Path tells a few media outlets that the Chapter 11 filing was made in response to a creditor garnishing the company’s bank accounts, which prevented Yacht Path from paying its bills. Chapter 11 involves reorganization of a company so that it may remain active and pay its creditors over time.

According to court documents, Yacht Path has liabilities exceeding $7.5 million. It owes its secured creditors $259,447.66 and unsecured creditors $7,280,279.49, of which $5,124,845.50 amounts to priority claims. In Chapter 11 proceedings, unsecured priority claims include things such as deposits made by individuals for services not provided, salaries and commissions, and more. They are paid before other claims, except for administrative-related items like trustee fees. In Yacht Path’s case, court documents reveal the unsecured priority claims pertain to deposits as well as taxes and other debts owed to government bodies (such as custom duties). Deposits were made by the owners of more than 100 yachts and megayachts (some owners having more than one boat), ranging from a 38-foot catamaran to 130-, 151-, and 161-foot motoryachts, all of which were shipped from various destinations that its ships regularly serve.

Dennis Cummings, president of Yacht Path, tells The Triton that “Through whichever tools are available to us, our first goal is to make our clients whole.” Cummings, who operates Yacht Path with his brother Kevin, also told the yacht-crew newspaper that the reorganization process should take three to four months. “Do Kevin and I feel obligated to make these people whole? Absolutely,” the paper quotes him as saying. “Just allow me to run my business again. Free me from my handcuffs. What we have is worth saving, and the way to do that is to make good with these clients.”

Det Norske Veritas and Germanischer Lloyd to Merge

Two leading classification societies, Det Norske Veritas (DNV) and Germanischer Lloyd (GL), have signed a merger agreement. Pending approval from authorities, the resulting company, DNV GL Group, will be among the world’s largest classification societies. It will also have an even stronger foothold in the maritime industry, as well as the energy sector.

Under the agreement, DNV will hold 63.5 percent ownership of DNV GL Group. GL’s parent company, Mayfair, will have the remainder. DNV GL Group will be headquartered in Norway, helmed by DNV’s present CEO, Henrik O. Madsen (pictured). The maritime business unit will remain in its present location in Hamburg, Germany.

According to Leif-Arne Langøy, chairman of DNV’s board of directors, DNV and GL actually began discussing close cooperation in 1999, then again in 2006. “I am very pleased that timing now seems to be right,” he says.

Madsen says that customers, ranging from megayacht owners and builders to oil and gas companies, will benefit from a broader worldwide base and increased service expertise. “The merger rests on a strong strategic rationale, and responds to challenges of increased globalization, rapid technological change, and the need for sustainable development,” he explains.

Though GL is lesser known in the yachting industry, it dates back to 1867 and has offices in more than 80 countries. Since 2007, GL has been focused on expanding its reach through acquisitions. As for DNV, it was founded in 1864 and presently has offices in 100 countries. Since 1954 DNV has had a dedicated research department that has enhanced and developed services, rules, and industry standards in various fields.