Skyservice airline goes under
The Skyservice charter airline filed for receivership and shut down its operations Wednesday, putting 860 employees out of work.
Citing debt levels and changes in the Canadian vacation travel market, the bankrupt company cancelled flights out of Toronto's Pearson airport Wednesday, "as well as all remaining flights scheduled to depart Canada during the balance of the season in April," the company said in a release.
The company flies on behalf of other tour operators from numerous Canadian airports to sun destinations across the Caribbean.
The company has cancelled all remaining outbound flights from Canada. No further flights were scheduled to leave out of numerous Canadian destinations anyway, now that the busy March Break travel season has passed in most regions — but many Skyservice passengers may not yet have completed their return legs.
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"Skyservice Airlines and the receiver are committed to winding up the business in an orderly and responsible manner," a company release said.
On Wednesday morning, an unnamed secured lender of the company appeared at the Ontario Superior Court of Justice to petition receivership for Skyservice, and a receiver has been assigned to handle the insolvency. The receiver will work with the company and other tour operators to resolve customer and employee issues "promptly."
The closure will result in the loss of 860 jobs. Former employees of the Montreal-based company have confirmed to the CBC that employees were all paid full wages and vacation pay before the shutdown.
It's not yet clear what sort of impact the shutdown might have on fliers and consumers, but so far all sides are promising no one will be stranded.
Contacted on his honeymoon on the Mayan Riviera, Winnipegger Christian Clavelle said he wasn't worried about getting home after being informed of Skyservice's demise by CBC News. He and his wife flew on the carrier with their wedding guests a few days ago and are set to return on Saturday.
"I'm not worried, this is all going to work itself out," Clavelle said. "We have a few days to work out the details [but] there are planes in the air so something is going to get us back."
Refunds possible
MasterCard Canada and Visa Inc. both issued statements Wednesday, reminding customers of their longstanding general policy to refund purchases for customers who do not receive the goods and services they paid for, such as any scheduled Skyservice flights.
Both companies advise customers to contact their card issuer with receipt and ticket information to begin the refund process.
Signature Vacations spokeswoman Janine Chapman said her company was prepared to deal with the shutdown of Skyservice operations. Signature has worked with Skyservice in the past but recently linked up with the rival Sunwing fleet of planes.
Sunquest Vacations announced it has organized replacement flights for customers affected by Skyservice's shutdown.
"Since it is late in the winter season, a relatively small number of our passengers were booked on Skyservice flights and we have the capability to respond effectively to this situation," said Michael Friisdahl, president of Thomas Cook PLC, which owns Sunquest.
Operating a fleet of 17 planes, Skyservice normally runs 25 flights a week out of Pearson airport in Toronto alone. Founded in 1986, Skyservice was acquired by Vancouver-based hedge fund Gibralt Capital Corp. in 2007.