Thousands of New Year cruises cancelled as All Leisure Holidays stops trading

Cruise line owner All Leisure Holidays has cancelled thousands of bookings and left hundreds of holidaymakers overseas after the business unexpectedly collapsed.

The owner of cruise operators Voyages Of Discovery and Swan Hellenic immediately ceased trading on Wednesday, forcing both lines to cancel New Year cruises at short notice.

The UK's Civil Aviation Authority (CAA) said it will ensure the company's 400 holidaymakers currently abroad will be repatriated at no extra cost under the terms of the Air Travel Organisers Licence (Atol) protection scheme, which safeguards package holidaymakers.

Most of those customers are currently near Malaysia and around the Mediterranean, the CAA said.

The majority of the company's 150 employees were made redundant shortly after the company fell into administration and all future bookings have been cancelled, leaving around 13,000 people seeking refunds.

Around two-thirds of customers are protected under the Atol scheme while remaining holidaymakers on UK departing cruises will be able to get their money back through Abta.

Andy Cohen, head of Atol at the CAA, said: "We understand this will be concerning news for anyone who has booked to travel with the company.

"However, the Atol scheme exists for exactly this kind of situation and we are making immediate arrangements so all Atol-protected customers can claim full refunds as quickly as possible.

"We are also arranging for people currently overseas to get back home to the UK at no extra cost - meaning no-one will be left stranded abroad."

Grant Thornton, which has been appointed as administrator for All Leisure Holidays, said it will work with the CAA and Abta to "minimise the disruption to any vessel workers and future passengers bookings wherever possible".

In a statement, the administrator said it managed to save 200 jobs by selling off sister brands Travelsphere and Just You to Canadian tour operator G Adventures.

Grant Thornton partner Eddie Williams said: "Whilst I am extremely pleased to have concluded a sale of the business which safeguards the holidays and bookings for over 13,500 tours passengers and preserves 200 jobs, I am very disappointed that we have no alternative other than to close the remaining ALH operations.

"The sale to G Adventures was particularly complicated and required extensive interaction with numerous worldwide parties and the licensing authorities during December and over the Christmas period.

"However, the cruise operations have been significantly loss-making over a number of years and the ongoing cost of funding these operations by the tours operations has created significant cash issues for the entire group which has ultimately led to the administration of all businesses."

The CAA set up a dedicated helpline for those affected on 0808 164 8810.

Further information is available at www.atol.org.uk and a refund claim form will be available shortly, the CAA said.