Updated: ShoreTrips placed in receivership; owes $4.8M in deposits

Saddled with more than $6 million in debt, cruise excursion provider ShoreTrips has been placed in receivership as owners Barry and Julie Karp try to sell rather than permanently shutter the pandemic-ravaged company.

According to court filings in Wisconsin, the Milwaukee-based company’s liabilities include $4.76 million in customer deposits for trips that have been canceled. Additionally, the company owes $974,324 in accounts payable and $345,000 in long-term debt but has just over $100,000 in cash and assets.

ShoreTrips filed for protection from creditors in state circuit court in Milwaukee last month under Wisconsin’s Chapter 128, which offers a state alternative to federal bankruptcy protection.

Milwaukee County circuit court judge Timothy Witkowiak appointed attorney Seth Dizard of the firm O’Neil, Cannon, Hollman, DeJong Laing S.C. as receiver in the case. Last week, the judge ordered all creditor claims to be filed through the court by March 1.

In a statement, Barry Karp said the company sought voluntary receivership in hopes of being able to resume operations with new owners.

“After facing an unprecedented year that has been challenging for so many, especially those in the travel and tourism industry, the business became a situation that was untenable,” Karp said.

“As a company, we’ve decided to use the resources provided to us under state receivership in order to work through sustaining the business and its effects endured by Covid-19,” he said. “We are currently working with the receiver to sell the business as a going concern. As we begin our restart process, and with the recent positive news of a vaccine underway, we anticipate returning for the 2021 cruise season in a position to better serve the industry and cruise goers around the world.”

According to a document being circulated by Dizard, the court-appointed receiver, at least one party is interested.

The document from Dizard and the management group Wadsworth Whitestar Consultants says Dizard is currently negotiating an “Asset Purchase Agreement with a prospective buyer” and is seeking competitive bids on an expedited basis.

ShoreTrips is one of the country’s largest independent providers of commissionable shore excursions.

Background information being circulated as part of that request for bids says ShoreTrips was founded in 2001 by the Karps to offer an “an alternative to the crowded coaches and highly commercialized destinations typical of shore excursions offered by cruise lines.”

Over the years, the document says, the company has developed an extensive network of more than 2,000 local guides and tour operators in more than 450 destinations around the world.

At its peak in 2019, the company had approximately 20 employees and generated gross revenue in excess of $22 million.

And while the pandemic-induced shutdown has had a “catastrophic impact” on ShoreTrips’ business, with all employees currently furloughed and revenue at zero, the document said that “the enormous pent-up demand for leisure travel has the potential to revitalize the business very quickly.”

This report was updated at 9:30 a.m. Dec. 22.