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Old October 31st, 2007, 07:49 PM
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Default Windjammer update

I just spoke to a member of the Burke family regarding the current Windjammer situation. Susie, sister of Joey who is now in charge of the company, called me to respond to the newsletter we posted yesterday about our concern for Windjammer.

From what she tells me, Windjammer does have a plan of execution for bring the campany back into business right now. What they do not have is a lot of cash. They are actively looking for someone who can come to the table with a cash infusion, and also bring cruise ship operations skills to the table.

"The last six months have been devatstating for the family," say Susie. "We lost our brother Danny last March (07), and he was the one family member who was most actively involved in running the business."

The father of the family was Michael Burke who started Windjammer 60 years ago. He ran the operation himslef until he passed away. The company was left to all the children in the form of a trust, but most of them did not take an active interest.

The trustee is a David Harris who resides in the Isle of Mann (U.K.). Susie says that they know and trust David, but that David has put her brother Joey in command of the company for now. Joey has come forth with some public statements on plans to bring the company around, and though the task appears somewhat daunting right now, the family claims that the committment to their customers is still there.

Right now just one of the four ships the company owns is in service, the Legacy. Reservations are being taken for that ship now, the next sail date being November 3rd. The ship sails out of Costa Rica. The other three ships have been out of action since late September.

According to Susie, all of the upcoming Legacy cruises are being filled, mostly with"make-up" cruises for people who paid and did not get to cruise. Reservations are not being taken for the other ships, though Susie says the company is working hard on needed maintenance and hopes to have them sailing by April at the latest. She even said "optimistically, we think February is possible, but we do not want to make any promises we cannot keep."

As for promises, Susie says, "Joey is serious about making sure every person who paid for a cruise will get their cruise, it is just a matter of when we can accomodate them." She is upset that the company has been plagued by "rumors" posted online, and that a few disgruntled passengers have been making a lot of noise in several places about not getting a refund. The idea she wanted to impart with me was that "Windjammer is not trying to rip anyone off, and we care about making good to all of our passengers, all we are asking for right now is their patience."

So, how good are the prospects. One thing Susie mentioned that I have not seen them mention before is that Windjammer is actively seeking a new "partnership". They would welcome the sort of cash and management experience infusion that was recently given to NCL, for example. Though they do not need nearly as much money.

CruiseMates posted a newsitorial yesterday saying we cannot recommend any booking a new Windjammer cruise right now until they can demonstrate they have the financial wherewithal to keep the company afloat even though the times when they have to make up cruises from people who already paid.

While I did not get the impression that Windjammer currently has the necessary cash flow to weather this storm, I was encouraged to hear Susie say that they have renewed efforts to find the "right" partner.

She alluded that the family had set their hopes on the "wrong" people in the recent past, and when those people did not come through it was a "wake-up call" to all the Burke children that more serious attention to the matter was needed right away. She says all four ships were fully provisioned as recently as September and all seemed well. The reason they didn't sail had more to do operational problems than cash flow. now, however, with the recent cancelled sailings and lack of incoming revenue, the situation deteriorated more rapidly than anyone thought it would, which has been "devastating" to the entire family.

As editor of CruiseMates, I have to say that while yesterday I said I had my doubts about their ability to pull off a company resuurection, I will say that today I see a glimmer of hope. I will say that I do now believe it is possible they will turn the company situation around IF we hear news in the next couple of weeks that they have partnered with someone who truly knows the cruise business, and has the financial assets to pull them out of this hole.

I did not get the impression they have the deep pockets within the family itself to fix the problem. As of yet, they still cannot sell airfare which requires posting a bond. But they are selling cruise tickets, and hopefully will be selling them for all four ships very soon.

The good thing is that all four ships are paid for, unencumbered, and the company has no other outstanding debt, according to Susie. "What we need is an investor with ship operations experience, someone who can get those ships in shape and make sure we deliver what we promise."

So, what does CruiseMates recommend now? A "wait 'n see apporach." If I had purchased a cruise and lost my money, I would try to reschedule it and see what happens. Maybe I will get a cruise on Legacy after all. I still can't say "buy those Windjammer tickets now while they are on sale!" but if I hear they have the right new partner, then I wouldn't hesitate.

Cuise lines have gone under before due to mismanagement, and they have come back. Renaissance cruises was plowed under when Ed Rudner was in charge, but when Oceania Cruises emerged with almost the same management (minus Rudner) and leased back the same ships, they were an unbridaled success.

The Burkes have been through some very tough times lately, losing their beloved brother in March and now coming close to losing a business that has been in the family for 60 years.

I wish Windjammer and the Burkes the best.
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