SHAREHOLDERS of Dolphin Cove Limited will have to wait a couple more months to get additional clarity regarding the next steps to be executed by creditors who are overseeing the chapter 11 bankruptcy proceedings of Leisure Investments Holdings LLC (LIH).

This was the update provided by LIH’s independent director, Steven Robert Strom and Sean T Greecher, attorney and partner of Young, Conaway, Stargatt & Taylor, LLP, at Dolphin Cove’s annual general meeting (AGM) held on July 3.

Leisure Investments entered chapter 11 bankruptcy proceedings on March 31 after noteholders exercised their collateral rights to remove all existing members and directors of Leisure Investments and Controladora Dolphin SA de C.V. (Dolphin Discovery), along with other Mexican and American subsidiaries. Strom was appointed as the sole independent director of those entities as he began the process to recover value for noteholders who are owed over US$100 million. Strom is the founder of Odinbrook Global Advisors, which specialises in advising clients on managing special situations, distressed debt, and bankruptcy events.

“From the US debtors’ standpoint we view Dolphin Cove and the interests in Dolphin Cove that is held by the chapter 11 entities as an invaluable piece of the puzzle of how creditors at the parent company will receive recoveries for claims. That will require.. working more closely with the Dolphin Cove board and management to determine the best way to maximise the value of equity,” said Greecher, who joined the AGM via Zoom.

Dolphin Cove Limited is a 79.99 per cent subsidiary of World of Dolphins Inc, which is a Barbadian international business company (IBC). World of Dolphins pledged all the shares it owned in Dolphin Cove in April 2019 as co-security for a US$100-million note purchase agreement that was issued by Dolphin Discovery. These debt obligations were stated to have been in default since September 2023, based on court documents.

Strom explained that his team are finally getting access to information regarding Dolphin Capital Company, S. de RL de C.V. (Dolphin Company) operations in Mexico and across the world. As a result, he was not able to give any timing or details on the next steps regarding World of Dolphin’s stake in Dolphin Cove. The Dolphin Company and its subsidiaries have 30 attractions in eight countries, across three continents.

“We’ll start to evaluate that soon. We’ve not really had anything [to discuss]. I’ve literally been a director for, I think, about two or three days now. I do want to emphasise that [given] a lot of the things that are going on in the bankruptcy and a lot of the problems that we’re experiencing, I’m very encouraged because I don’t see those problems today in Jamaica,” added Strom who also joined via Zoom. Strom praised the company’s governance and financial reporting during the meeting.

The Delaware bankruptcy court on July 3 approved LIH to retain Greenhill & Co, LLC as its investment banker, and Keen-Summit Capital Partners LLC as its real estate advisor and broker effective May 15. Leisure Investments previously filed documents indicating its intention to sell some of the group’s real estate assets. Some of these documents listed four of Dolphin Cove’s Jamaican properties as foreign, jointly marketed properties.

When Strom was asked about the potential sale of the Jamaican properties, he responded, “We’ve not begun the evaluation of how we want to deal with the Jamaican entity as a whole, but I look at it right now as we have a series of parks with [a] good management team, reporting structure, governance — the necessary ingredients, to me, that don’t necessitate the change in the operations.”

A July 2 court filing indicated that LIH intends to sell the Duck Key, Marlineland and Panama City properties in Florida. These sales are expected to close by November. The Zoomarine, Aquafelix, and Acquajoss properties in Italy are currently being marketed to prospective buyers on a going concern basis.

LIH is also seeking to sell some of the animals, real estate and other real property to ensure the safety and humane treatment of the animals while liquidity remains constrained. The holding company wants the court to fast-track these sales without additional hearings so as to bring value to the estate and protect the interest of the various animals like dolphins, sea lions, manatees and seals.

Unwinding related party deals

Dolphin Cove is currently owed US$1.11 million by Dolphin Discovery Inc, which is another subsidiary of Dolphin Discovery. That advance represented 40 per cent of the estimated project cost to develop a new dolphin encounter park in St Lucia on behalf of Dolphin Cove. That project was shelved due to the COVID-19 pandemic.

Dolphin Cove is also owed US$3.18 million from its parent company and other Dolphin Company subsidiaries. The repayment of these unsecured funds will be determined accordingly as Strom and Chief Restructuring Officer Robert Wagstaff work with noteholders and the committee of unsecured creditors.

“Until we’ve gone through the process of asset review, valuation and monetisation of assets that can be monetised, it’s a bit early to know what level of recovery those unsecured creditors are going to receive,” Greecher responded to a shareholder’s query.

Strom has begun the process to remove former Dolphin Company executives who served on the boards of the various subsidiary companies, after more than two months of court proceedings. Strom removed Eduardo Albor Villanueva and Concepción Esteban Manchado as directors of World of Dolphins Inc., Dolphin Cove’s parent company. His appointment as a director to World of Dolphins gave way for him to remove Albor, Valeria Albor Dominiguez, Sergio Jacome Palma and Federico Lozano Perez as Dolphin Cove directors on June 30 through Article 95(h) of the company’s articles of incorporation. Gina Phillipps Black, partner at Myers, Fletcher & Gordon which represents Dolphin Cove, was present at the AGM.

“Recently, Leisure Investments and its subsidiaries have effected the removal of prior management at World of Dolphins Inc, which is a Barbados entity. After this step at World of Dolphins we’ve been working to procure the removal of the directors from Dolphin Cove Jamaica who were previously involved in the operations of LIH and its subsidiaries. We’ve been communicating with the board members regarding the appointment of Mr Strom to the board and reappointment of Mr Burrowes to the board,” Greecher added on the recent developments.

Stafford Burrowes’ office as a director was vacated on May 30 when the then Albor-controlled World of Dolphins used Article 95(h) to remove him from the company he founded in February 2001. However, Burrowes and Strom were appointed directors of Dolphin Cove on July 1 and were elected as directors at the AGM. John Bailey and Noel Levy were also re-elected as directors of the company on Thursday. Burrowes was recognised as chairman of the board.

Former Dolphin Discovery chief executive officer and majority shareholder Albor was found in contempt of court on June 5 by Judge Laurie Selber Silverstein, for different violations. Her ruling made way for Strom and Wagstaff to start their activities to understand the overall Dolphin Company estate. LIH sought permission from the courts on May 19 to retain Hamel-Smith Caribbean. More information on the ongoing case can be found at veritaglobal.net/dolphinco.

It was revealed on Monday that Meland Budwick and Gellert Seitz Busenkell & Brown LLC were granted permission by the court to withdraw as counsel for Albor. Both firms indicated that their withdrawal was due to Albor not fulfilling his financial obligations in paying for their services.

Burrowes confident

Despite all of the events, Burrowes is confident that Dolphin Cove should have a better year ahead than 2024. He noted that the Ocho Rios Pier should be operational again by the end of this month, after it was damaged in February 2024. He also indicated that last year had one-off events like Hurricane Beryl, the US travel advisory, and the United States election as factors which impacted revenues.

Dolphin Cove reported an 11 per cent dip in revenue to US$15.30 million during 2024, with net profit declining two-fifths to US$1.83 million. Revenue for the first quarter (January to March) was down 17 per cent to US$4.08 million ($641.22 million), with net profit declining 38 per cent to US$859,290 ($134.90 million). Dolphin Cove’s stock price has increased 17.72 per cent in July to $14.57, but the stock is still down 21 per cent in 2025 with a market capitalisation of $5.72 billion.

“We’re still very interested in getting a hotel to be developed on the property in Lucea. It’s 22 acres, it’s oceanfront, and we feel that we will find someone sooner or later that will develop the property. The previous development that was planned there was going to keep the dolphins and dolphin attraction in operation. A dolphin attraction in a hotel is typically profitable,” Burrowes noted on the development of a property which it advertised for US$18 million ($2.79 billion) last year.