Bankrupt plane ticket platform asks to liquidate

The platform is asking a bankruptcy judge to convert its case.

Mar 21, 2025 - 14:12

Bankrupt plane ticket platform asks to liquidate

While 2024 has seen airlines like Spirit (SAVE) and Silver Airways declare bankruptcy, it has also been a tumultuous year for travel platforms and flight aggregators.

Mondee Holdings (MOND) , an online booking marketplace used by agents and other travel professionals to craft itineraries for their clients, was delisted from the Nasdaq in December 2024 and, by mid-January, announced that it was filing for Chapter 11 protection in the U.S. Bankruptcy Court for the District of Delaware.

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From 'decisive action' to liquidation: A short timeline of the Mondee case

Mondee includes 18 affiliates brands such as Hari World, Skylink, Transam, Cosmopolitan and C&H. At the time, the bankruptcy emergence plan the company stated included selling assets to a new entity backed by hedge funds TWC Asset Management Company and Wingspire Capital while also securing $49 million in debtor-in-possession financing from preposition lenders.

"We have taken decisive action to overcome past challenges and are encouraged by employee engagement, organizational culture, and our ability to deliver best-in-class products and services," Mondee CFO Jesus Portillo said at the time.

But on March 20, Mondee asked the same bankruptcy court to change its Chapter 11 case to Chapter 7 liquidation. The company argues that the initial bankruptcy plan would leave it with over $1 million in tax and creditor liabilities and no assets left to settle those liabilities.

As a result, the travel platform that used AI and other technology to craft personalized travel itineraries is asking the judge for permission to go straight to liquidation; it had already ceased all operations in October 2024.

Liquidation is 'warranted and necessary': court motion

"Therefore, the debtors submit that expeditiously converting these Chapter 11 cases to cases under Chapter 7 of the bankruptcy code upon closing of the sale is warranted and necessary," the motion first reported by Law360 reads.

Going public in December 2021, Mondee spent just over two years on the stock exchange before its financial problems started to catch up with it.

The initial declaration of bankruptcy named the Covid-19 pandemic, negative stock performance and increased competition as the reasons for its rapidly-accruing debt of $358 million at the time of filing.

Despite having several high-profile clients including major airlines, Mondee ultimately failed to deliver a clear product and stand out from a number of professionals also offering trip itineraries and air plane ticket consolidation.

It also made the classic business mistake of expanding too fast by acquiring businesses in not just airlines but also industries such as lodging, car rentals, and cruise companies.

Prior to asking for Chapter 11 protection, Mondee reported conducting liquidity analyses and exploring several merger and acquisition deals and other restructuring possibilities before ultimately seeing no other way out. After filing, Mondee saw no offers that would not still leave it with a heavy debt load.

More bankruptcy:

"No other qualified bids were received for the assets and Mondee cancelled an auction Wednesday to move forward with the stalking horse deal [a pre-auction bid that sets the initial price], which will wipe out $30 million of debtor-in-possession financing through a credit bid, plus certain prepetition amounts," Law360 reported.