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Haimark, a high-end river cruise line that specializes in exotic destinations, is emerging from the difficulties surrounding its seagoing Saint Laurent ship. The company announced its acquisition by Los Angeles-based VC2 Capital, a merchant banker and financial advisory firm, at the end of January.
The acquisition includes Haimark’s river cruise operation, operating on the Ganges, Mekong, Irrawaddy and Amazon rivers, and the seagoing Haimark Line with the Saint Laurent, which had firm plans to be the first cruise line to sail to Cuba from Miami starting this month.
“We believe the entire team for Haimark, with their entrepreneurial vision, commitment to high customer service and focus on company culture, is a perfect platform for us to build upon,” said Adam Levin, managing director of VC2.
It was this eagerness to work with Haimark, rather than absorbing the company, that made the deal so attractive to the cruise line, along with VC2’s strong interest in expanding in the leisure sector, according to Haimark president and industry veteran Hans Rood.
Haimark’s problems arose after an accident last June when the Saint Laurent struck a wall in a lock in the St. Lawrence Seaway. The hull suffered significant damages, and four cruises were canceled while repairs were made. Generous compensation and accommodations were made for the passengers affected, including a chartered Boeing 737 to bring guests from early ports to the ship, refunds, onboard credits and vouchers for future cruises. After considerable wrangling with the involved parties, Haimark Line (separate from the river cruise operation) filed for Chapter 11 bankruptcy. At the time, Rood called the situation with Saint Laurent a “dragging matter,” with enormous out-of-pocket costs that placed a financial strain on the company.
However, the prospect looks far better now, as Haimark puts the issues with Saint Laurent behind it and enters into plans for the future with VC2.
“We have a fantastic itinerary,” said Rood, as Haimark works to solidify plans for Cuba sailings. “We have had to cancel the Feb. 11 and 20 sailings. We hope to be able to operate the Saint Laurent [with Chapter 11 resolved after the sale] or another ship by March 1.”
Haimark has a very different business model from most cruise lines. Because the company’s river cruise line specializes in exotic destinations and designs seven-day itineraries, it needs to work through tour operators to combine these cruises with land packages that give a full experience and appeal to guests who fly long distances, Rood says.
“You can’t just bring people for a weeklong cruise in India,” he said.
So the bulk of Haimark’s business is creating exceptional ships, setting up itineraries and shore excursions and more, which the tour operators or cruise lines charter and combine with the remainder of the package. Haimark works with a variety of tour operators and cruise lines, from Avalon Waterways to Uniworld Boutique River Cruise Collection.
Rood says this will continue to be the ongoing strategy, and generous commission has attracted agents to these sailings.
“You can’t be all things to all people,” he said. “We don’t want to become competitors to our tour operators and cruise lines that are the distribution for more than two-thirds of our inventory, so we only sell our cruises during the periods when our ships are not under charter.”
The one exception to the business model are the Cuba and Great Lakes cruises, which Haimark Line is selling to the North American, European, Australian and, increasingly, Chinese markets.
“These areas have strong appeal across national groups,” Rood said. “Really, the distinction is not so much geographic as it is that people who want to take these cruises are usually very well-traveled and sophisticated.”