Is this usual? Travel company taken over by another company.

JeremyHilary

I booked a short UK package break holiday in 2021 that departed in Sept 2022.

In August 2022 the original travel company went into administration and I had a call stating that this had happened and was I happy for my holiday to be transferred to a new company who had taken over the old company. I agreed to this.

The holiday took place as seamlessly as if it had been delivered by the original company. I did not have to pay any more money.

The new company are now trying to get all of the people who bought this holiday to claim the price of the holiday back via a card chargeback. I find this odd as I have not lost any money. As far as I am concerned I got the holiday I paid for.

 The travel company who went bust are/were ABTA protected.

 Company 2 bought out company 1 who were on the brink of administration and couldn't afford to pay for all the booked holidays.

Company 2 paid for all the booked holidays so that they could go ahead.

Company 2 now own company 1 (who are running pretty much as they were) and are now out of pocket because of paying for all the holidays.

Also apparently even though the holiday was covered by Company 1's insurance, the insurance company require that all customers attempt a chargeback before they will consider a claim.

DullGreyGuy

Was this a bus company? There was a very similar post a few months ago but you are missing one crucial piece that the other poster said... if the chargeback was successful you were to pay company 2 the same money. If it was unsuccessful then company 2 would take it on the chin.

The error the other poster made, and is often the case in these types of things, is that Company 2 did not buy Company 1 but instead it bought the company's assets such as brand and customer list. 

eskbanker

It's all moot anyway as it's too late to initiate a chargeback now for a trip that happened over 120 days ago....

JeremyHilary

No it's not a bus company. 

Yes Company 2 have asked that if the chargeback is successful I send them the money, I guess it would be fraud otherwise! 

Company 2 are still asking for us to request the chargeback and then provide evidence if the bank refuses. 
I'm struggling to see why I should have to do all this legwork, but I don't want to end being chased by debt collectors if Company 2 decide to do that. 

JeremyHilary

I think they might have bought the whole company as they seem to have kept the staff on. I'm not 100% sure on that though. 

DullGreyGuy

JeremyHilary said:

Yes Company 2 have asked that if the chargeback is successful I send them the money, I guess it would be fraud otherwise! 

Company 2 are still asking for us to request the chargeback and then provide evidence if the bank refuses. 
I'm struggling to see why I should have to do all this legwork, but I don't want to end being chased by debt collectors if Company 2 decide to do that. 

I struggle to see what grounds you have for a chargeback,,, you paid for X and got X the only thing is that you paid 1 for X but 2 provided it. This in itself isnt unusual as there are thousands where sellers and fullfilment are separate but this is different because its an after the event thing not how it was supposed to operate. 

If you search on here for the company name, if you dont want to give it, then you'll probably find its the same company as cannot see many doing this. 

Really comes down to if its easier to have 1 one call with your bank saying please send a letter to say the chargeback is impossible as over 120 days or have to keep dealing with the company chasing you. 

JeremyHilary said:

I think they might have bought the whole company as they seem to have kept the staff on. I'm not 100% sure on that though. 

Staff can be TUPED across. Its unusual for a company in administration to be bought in its entirety as it means they keep all the liabilities and if a chargeback was done it would be taken from their bank account. Normally you buy the assets and not the company meaning the old liabilities are written off after the monies for the sale are distributed and the chargeback is funded by the former company's merchant account provider.  

JeremyHilary

Thanks for the replies.

I can see on here that there are other posts and other people seem as confused as I am! It's Arena who have been taken over by Leger. 

I agree I don't think I have grounds for chargeback as I got the holiday I paid for. I'm annoyed that they're trying to get me to do this legwork, I feel like they had us over a barrel as nobody wanted their holiday cancelled as it was part of a bigger event. 

bagand96

So Leger took over Arena and agreed to honour existing bookings.  This has obviously cost them a lot of money to do (more than expected?) so they're now asking customers to chargeback and then send them the money.

Doesn't seem normal to me.  As you and others have said I'm not entirely sure you even have grounds for a chargeback as you got what you paid for.  If Leger agreed to honour your booking then their subsequent internal accounting/finance issues are not your responsibility.

Brie

I would have thought the bank would refuse a charge back on the grounds you got what you paid for.  Sounds like the travel company is promoting you to commit fraud.

eskbanker

JeremyHilary said:

I agree I don't think I have grounds for chargeback as I got the holiday I paid for. I'm annoyed that they're trying to get me to do this legwork, I feel like they had us over a barrel as nobody wanted their holiday cancelled as it was part of a bigger event.

It appears from https://www.leger.co.uk/arena-faqs that it was effectively a quid pro quo, i.e. that Leger agreed to provide you with the holiday you'd paid Arena for, but that this was conditional on you seeking recovery of costs from card providers (and ultimately CAA/FFI if unsuccessful) and forwarding this to Leger - how was this presented at the time?

DullGreyGuy

bagand96 said:

So Leger took over Arena and agreed to honour existing bookings.  

They didn't take over Arena... Arena is still in administration as the statement of affairs was only published on the 9th. They bought assets not the company.

Company, after the sale of assets had £10,001 to its name and owes over £240,000 to HMRC alone and just under £4m all in... how much would you pay to buy a £4m liability when you can buy the assets without the debts?