Sea Containers was a

Bermuda Bermuda is a British Overseas Territories, British Overseas Territory in the Atlantic Ocean, North Atlantic Ocean. The closest land outside the territory is in the American state of North Carolina, about to the west-northwest. Bermuda is an ...

n registered company which operated two primary business areas: transport and

container A container is any receptacle or enclosure for holding a product used in storage, packaging, and transportation, including shipping. Things kept inside of a container are protected on several sides by being inside of its structure. The term ...

leasing. It was founded in 1965 by

James Sherwood James Blair Sherwood (August 8, 1933 – May 18, 2020) was an American-born, British-based businessman, and the founder of Belmond Limited and Sea Containers. Early life James Blair Sherwood was born in Newcastle, Pennsylvania, the son of Willia ...

and was initially focused on the leasing of

cargo containers Containerization is a system of intermodal freight transport using intermodal containers (also called shipping containers, or ISO containers). Containerization, also referred as container stuffing or container loading, is the process of uni ...

. During 1974, Sea Containers was floated on the

New York Stock Exchange The New York Stock Exchange (NYSE, nicknamed "The Big Board") is an American stock exchange in the Financial District, Manhattan, Financial District of Lower Manhattan in New York City. It is the List of stock exchanges, largest stock excha ...

. Over the next three decades, the company branched into various other markets, leading to the creation of the

Orient-Express Hotels Belmond Ltd. (formerly Orient-Express Hotels Ltd.) is a hospitality and leisure company that operates hotels, train services and river cruises and safaris worldwide. In 2024, the company has 47 properties in 28 countries and territories, with 3 ...

chain,

hovercraft A hovercraft (: hovercraft), also known as an air-cushion vehicle or ACV, is an amphibious craft capable of travelling over land, water, mud, ice, and various other surfaces. Hovercraft use blowers to produce a large volume of air below the ...

, and the

Venice-Simplon Orient Express The ''Venice Simplon-Orient-Express'' (VSOE) is a private luxury train service from London to Venice and other European cities. It is currently owned by Belmond. These VSOE services are not to be confused with a regularly scheduled train cal ...

train service. In May 1989, the British-based transport company

Tiphook Tiphook PLC was a United Kingdom headquartered transport services company that was registered on both the London stock exchange, London and New York Stock Exchange, New York stock markets. It was once a constituent of the FTSE 100 Index and bec ...

launched a $824 million bid to take over Sea Containers, which was successfully opposed by Sherwood. Sherwood maintained his leadership of the company into the twenty-first century, during which time he become fairly wealthy, something for which he was criticised following the collapse of the company. During the 1990s, Sea Containers successfully bid for the

InterCity East Coast InterCity East Coast is a railway franchise for passenger trains on the East Coast Main Line in the United Kingdom from London King's Cross to Hull, Leeds, Bradford, Harrogate, Newcastle, Edinburgh, Glasgow, Inverness and Aberdeen. It was fo ...

franchise amid the

privatisation of British Rail The privatisation of British Rail was the process by which ownership and operation of the Rail transport in Great Britain, railways of Great Britain passed from government control into private hands. Begun in 1994, the process was largely compl ...

; it was awarded a seven-year franchise which it operated via a newly created subsidiary

Great North Eastern Railway Great North Eastern Railway, often referred to as GNER, was a train operating company in the United Kingdom, owned by Sea Containers, that operated the InterCity East Coast franchise on the East Coast Main Line between London, Yorkshire, No ...

(GNER). In March 2005, the

Strategic Rail Authority The Strategic Rail Authority (SRA) was a non-departmental public body in the United Kingdom set up under the Transport Act 2000 to provide strategic direction for the railway industry. Its motto was 'Britain's railway, properly delivered'. It ...

awarded the franchise to GNER for a further seven years; however, this newer arrangement lacked

subsidies A subsidy, subvention or government incentive is a type of government expenditure for individuals and households, as well as businesses with the aim of stabilizing the economy. It ensures that individuals and households are viable by having acce ...

, instead requiring payments from GNER, contributing to the company's future financial hardship. During March 2006, amid several financial setbacks, Sherwood resigned from Sea Containers and many of his other companies. On 16 October, the company filed for

Chapter 11 Chapter 11 of the United States Bankruptcy Code ( Title 11 of the United States Code) permits reorganization under the bankruptcy laws of the United States. Such reorganization, known as Chapter 11 bankruptcy, is available to every business, w ...

bankruptcy protection. While the remainder of the group was being wound down and

liquidated Liquidation is the process in accounting by which a company is brought to an end. The assets and property of the business are redistributed. When a firm has been liquidated, it is sometimes referred to as wound-up or dissolved, although di ...

, the remaining maritime container interests were transferred to the newly created ''SeaCo Ltd'' in 2009.

History

Founding and diversification

Sea Containers was established in 1965 by

Yale University Yale University is a Private university, private Ivy League research university in New Haven, Connecticut, United States. Founded in 1701, Yale is the List of Colonial Colleges, third-oldest institution of higher education in the United Stat ...

graduate and retired

United States Navy The United States Navy (USN) is the naval warfare, maritime military branch, service branch of the United States Department of Defense. It is the world's most powerful navy with the largest Displacement (ship), displacement, at 4.5 millio ...

officer

; it had an initial

capital Capital and its variations may refer to: Common uses * Capital city, a municipality of primary status ** Capital region, a metropolitan region containing the capital ** List of national capitals * Capital letter, an upper-case letter Econom ...

of $100,000. The company's initial activities were centered upon the leasing of

to various shipping companies. However, under Sherwood's leadership, Sea Containers expanded over a 40-year period into numerous other markets, including

luxury hotel A hotel is an establishment that provides paid lodging on a short-term basis. Facilities provided inside a hotel room may range from a modest-quality mattress in a small room to large suite (hotel), suites with bigger, higher-quality beds, a d ...

s and

railway Rail transport (also known as train transport) is a means of transport using wheeled vehicles running in railway track, tracks, which usually consist of two parallel steel railway track, rails. Rail transport is one of the two primary means of ...

s, many of these sectors being those that Sherwood had taken a personal interest in. During 1968, Sea Containers became a

public company A public company is a company whose ownership is organized via shares of share capital, stock which are intended to be freely traded on a stock exchange or in over-the-counter (finance), over-the-counter markets. A public (publicly traded) co ...

; it was floated on the

in 1974. After enjoying a stay at the

Hotel Cipriani The Hotel Cipriani is a deluxe hotel on the island of Giudecca in Venice, northern Italy. It is reached by hotel launch from Piazza San Marco, St Mark's Square, a five-minute journey across the lagoon. Long considered one of the leading luxury ho ...

Venice Venice ( ; ; , formerly ) is a city in northeastern Italy and the capital of the Veneto Regions of Italy, region. It is built on a group of 118 islands that are separated by expanses of open water and by canals; portions of the city are li ...

, Sherwood purchased the luxury hotel. Subsequent similar purchased led to the creation of the

chain, which the Sea Containers held a stake in up until 2005. Another personal project was the prestigious

train service. Sherwood acquired thirty old 1920s carriages from across Europe and had them restored from often dilapidated conditions to facilitate the service's relaunch during 1982. During February 1986, the British

ferry A ferry is a boat or ship that transports passengers, and occasionally vehicles and cargo, across a body of water. A small passenger ferry with multiple stops, like those in Venice, Italy, is sometimes referred to as a water taxi or water bus ...

company

Hoverspeed Hoverspeed was a ferry company that operated on the English Channel from 1981 until 2005. It was formed in 1981 by the merger of Seaspeed and Hoverlloyd. Its last owners were Sea Containers; the company ran a small fleet of two high-speed Se ...

was purchased for £5 million by ''British Ferries'', a

holding company A holding company is a company whose primary business is holding a controlling interest in the Security (finance), securities of other companies. A holding company usually does not produce goods or services itself. Its purpose is to own Share ...

for Sealink UK, which was in turn owned by Sea Containers.

Foiled takeover and GNER

In May 1989, the British-based transport company

launched a $824 million bid to takeover Sea Containers, which was vigorously opposed by Sherwood. Amid this process, Tiphook's management alleged that Sherwood had an

authoritarian Authoritarianism is a political system characterized by the rejection of political plurality, the use of strong central power to preserve the political ''status quo'', and reductions in democracy, separation of powers, civil liberties, and ...

management style, while Sherwood issued his own allegations of irregularities in filings with the

Securities and Exchange Commission The United States Securities and Exchange Commission (SEC) is an independent agency of the United States federal government, created in the aftermath of the Wall Street crash of 1929. Its primary purpose is to enforce laws against market m ...

. Shareholders ultimately backed Sherwood's position, who had proposed asset sales and a restructuring to win favour, leading to Tiphook failing to acquire the company. During the

of the mid 1990s; Sea Containers was one of various private sector companies that sought to obtain one of the newly created franchises. Over time, it would place bids for multiple franchises, including the

South Western franchise South Western was a Rail franchising in Great Britain, railway franchise for the provision of passenger services from London Waterloo railway station, London Waterloo to destinations in Surrey, Hampshire, Somerset, Dorset, Berkshire, Wiltshire ...

in 2001 and the

South Eastern franchise The South Eastern franchise, also known as the Integrated Kent franchise, is a railway franchise for the provision of passenger services between London and Kent in South East England. History The South Eastern franchise was formed as a shadow ...

in 2006. However, its first bid was for the

franchise, which was viewed as a particularly desirable one to obtain, the

East Coast Main Line The East Coast Main Line (ECML) is a electrified railway between its northern terminus at and southern terminus at . The key towns and cities of , , , , and are on the line. The line is a key transport artery on the eastern side of Grea ...

(ECML) having been recently electrified while also being worked by the newest intercity stock in British Rail's inventory, the

InterCity 225 The InterCity 225 is an electric push-pull train, push-pull high speed train in the United Kingdom, comprising a British Rail Class 91, Class 91 electric locomotive, nine British Rail Mark 4, Mark 4 coaches and a Driving Van Trailer (DVT). The ...

, and thus had a well-established reputation for its high-speed services. In March 1996, Sea Containers was announced as the winner, being awarded a seven-year franchise upon the ECML via a newly created subsidiary

(GNER). During January 1997, Sherwood announced that GNER intended to procure a pair of two new-build

tilting train A tilting train is a train that has a mechanism enabling increased speed on regular rail tracks. As a train (or other vehicle) rounds a curve at speed, objects inside the train experience centrifugal force. This can cause packages to slide about ...

s which were claimed to enable the

London London is the Capital city, capital and List of urban areas in the United Kingdom, largest city of both England and the United Kingdom, with a population of in . London metropolitan area, Its wider metropolitan area is the largest in Wester ...

Edinburgh Edinburgh is the capital city of Scotland and one of its 32 Council areas of Scotland, council areas. The city is located in southeast Scotland and is bounded to the north by the Firth of Forth and to the south by the Pentland Hills. Edinburgh ...

journey to be reduced to only 3 hours and 30 minutes. While an order having been reportedly placed during October 1997, no such tilting trains were ever introduced. Despite this, GNER would successfully increase service speeds and run the fastest scheduled service in Great Britain at that time. In March 2005, the

awarded the franchise to GNER for a further seven years, starting on 1 May 2005. The new franchise's terms were quite different from that of the original period; instead of GNER receiving

, it would be instead paying the British state for the privilege of operating; there was reportedly concerns over the financial viability of such an arrangement from the onset. In order to meet these payments, GNER assumed passenger numbers would increase by around 30 per cent across the life of the franchise, reaching around 20 million by 2015. During his leadership of Sea Containers, Sherwood accumulated substantial personal wealth; his net worth was estimated at £60million in the 2004 ''Sunday Times'' Rich List.

Financial hardship and collapse

In March 2006, Sea Containers announced that it was in the process of exiting from ferry operations, which had been one of the company's primary area of business; efforts were promptly launched to sell these operations onto third parties. Shortly thereafter, it was announced that the company lost a lucrative contract to provide back-up services to its container leasing operations, which by then it had been running as a

joint venture A joint venture (JV) is a business entity created by two or more parties, generally characterized by shared ownership, shared returns and risks, and shared governance. Companies typically pursue joint ventures for one of four reasons: to acce ...

with

GE Capital GE Capital was the financial services division of General Electric. Its various units were sold between 2013 and 2021, including the notable spin-off of the North American consumer finance division as Synchrony Financial. Ultimately, only one div ...

. These two negative headlines were seen as serious blows to the future of Sea Containers, which reportedly had accumulated debts adding up to $1.3 billion by May of that year. In response to these negative events, Sherwood promptly resigned from many of his companies, including Sea Containers. He was replaced by turnaround specialist Bob Mackenzie, while Ian Durant became senior vice-president of finance. MacKenzie sought to reduce the business' high debt burden via further sales, which he viewed as critical to any prospective rebuilding of the core enterprise; these efforts led to the rapid divestiture of 14,000 containers amongst other company assets. By July 2006, rumours were circulating that Sea Containers was preparing to sell GNER in an effort to avoid declaring

bankruptcy Bankruptcy is a legal process through which people or other entities who cannot repay debts to creditors may seek relief from some or all of their debts. In most jurisdictions, bankruptcy is imposed by a court order, often initiated by the deb ...

. Despite these activities, in early October 2006, Sea Containers announced that it was unlikely to be able to pay a $115 million (£62 million)

bond Bond or bonds may refer to: Common meanings * Bond (finance), a type of debt security * Bail bond, a commercial third-party guarantor of surety bonds in the United States * Fidelity bond, a type of insurance policy for employers * Chemical bond, t ...

that was due on 15 October. On 16 October, the company filed for

bankruptcy protection, at which point it reportedly had outstanding debts of $650 million with only $67 million of free cash remaining. Following this filing, Sherwood's role in the collapse, particularly his $2 million (£1 million) severance payment and $250,000 annual payout from his Sea Containers pension, was criticised; in response, he denied personal responsibility and attributed Sea Containers' fate to several factors, including elevated fuel prices, the

7 July 2005 London bombings The 7 July 2005 London bombings, also referred to as 7/7, were a series of four co-ordinated suicide attacks carried out by Islamist terrorists that targeted commuters travelling on Transport in London, London's public transport during the ...

, and incorrect assumptions in contract terms stipulated by the British government. On 6 November 2006, the

Department for Work and Pensions The Department for Work and Pensions (DWP) is a Departments of the Government of the United Kingdom, ministerial department of the Government of the United Kingdom. It is responsible for welfare spending, welfare, pensions and child maintenance ...

informed Sea Containers that it must pay £143 million into its two UK pension schemes if it wanted to wind them up. On 11 February 2009, the remaining maritime container interests of Sea Containers were transferred to a new company, ''SeaCo Ltd'', while the remainder of the group proceeded to be wound down and

. The major shareholders in the new company were the bondholders of the former Sea Containers Ltd and two of the group's UK pension funds.

Operations

Ferry services and related businesses

* Sealink British Ferries: ferry services around the United Kingdom and Ireland. Acquired in 1984, most Sealink operations were sold to

Stena Line Stena Line is a Swedish Shipping line, shipping line company and one of the world's largest ferry operators. It services Denmark, France, Germany, the United Kingdom, Ireland, Latvia, the Netherlands, Poland, Finland and Sweden. Stena Line is a ...

in 1990. *

Isle of Man Steam Packet Company The Isle of Man Steam Packet Company Limited (abbreviated to IoMSPCo or, locally, The Steam Packet ()) is the oldest continuously operating passenger shipping company in the world, having been founded in 1830. The company provides freight, p ...

: fast and conventional services in the

Irish Sea The Irish Sea is a body of water that separates the islands of Ireland and Great Britain. It is linked to the Celtic Sea in the south by St George's Channel and to the Inner Seas off the West Coast of Scotland in the north by the North Ch ...

. Acquired in 1996, sold in 2003. *

Silja Line Silja Line is a Finnish shipping company and cruiseferry brand owned and operated by the Estonian shipping company AS Tallink Grupp, for car, cargo and passenger traffic between Finland and Sweden. The former company Silja Oy—today Tallink S ...

: fast and conventional services in the

Baltic Sea The Baltic Sea is an arm of the Atlantic Ocean that is enclosed by the countries of Denmark, Estonia, Finland, Germany, Latvia, Lithuania, Poland, Russia, Sweden, and the North European Plain, North and Central European Plain regions. It is the ...

. In June 2006, Silja Line was purchased by

Tallink Tallink () is an Estonian shipping company operating Baltic Sea cruiseferries and ropax ships from Estonia to Finland, Estonia to Sweden and Finland to Sweden. It is the largest passenger and cargo shipping company in the Baltic Sea region. It ...

, a ferry company from

Estonia Estonia, officially the Republic of Estonia, is a country in Northern Europe. It is bordered to the north by the Gulf of Finland across from Finland, to the west by the Baltic Sea across from Sweden, to the south by Latvia, and to the east by Ru ...

. The fast

catamaran A catamaran () (informally, a "cat") is a watercraft with two parallel hull (watercraft), hulls of equal size. The wide distance between a catamaran's hulls imparts stability through resistance to rolling and overturning; no ballast is requi ...

service SuperSeaCat was separated from Silja Line and operated until 2008 when it went bankrupt. *

: (25% shareholding) sold in 2005 * SeaStreak: following the Sea Containers bankruptcy of 2006, this operation was sold to New England Fast Ferry * SNAV-Hoverspeed: a joint venture with Italian ferry operator

SNAV SNAV (Società Navigazione Alta Velocità) is an Italian company that operates ferry services from Italy to Sardinia, Croatia and Sicily. Routes SNAV operates a large network of routes across the Mediterranean and Adriatic. *Naples - Palermo ...

. Used the former ''Seacat Danmark'' as ''Zara Jet.'' * Aegean Speed Lines: a joint venture in Greece with the Eugenides Group. The service uses the former '' Hoverspeed Great Britain'' as ''Speedrunner 1'', which operated in the

English Channel The English Channel, also known as the Channel, is an arm of the Atlantic Ocean that separates Southern England from northern France. It links to the southern part of the North Sea by the Strait of Dover at its northeastern end. It is the busi ...

and held the

Hales Trophy The Hales Trophy, officially the North Atlantic Blue Riband Challenge Trophy is an award for the fastest Atlantic crossing by a commercial passenger vessel. The award was created in 1935 when Harold K. Hales, a British politician and owner of Ha ...

and

Blue Riband The Blue Riband () is an unofficial accolade given to the passenger liner crossing the Atlantic Ocean in regular service with the record highest Velocity, average speed. The term was borrowed from horse racing and was not widely used until ...

for the fastest crossing of the North Atlantic. *

: English Channel services ceased in 2005 *

SeaCat SeaCat was the marketing name used by Sea Containers Ferries Scotland for its services between Northern Ireland, Scotland and England between 1992 and 2004. The company was originally based in Stranraer later moving to Belfast. The name ori ...

: (

Belfast Belfast (, , , ; from ) is the capital city and principal port of Northern Ireland, standing on the banks of the River Lagan and connected to the open sea through Belfast Lough and the North Channel (Great Britain and Ireland), North Channel ...

Troon Troon (Scottish Gaelic: ''An Truthail'') is a town and sea port in South Ayrshire, situated on the west coast of Ayrshire in Scotland, about north of Ayr and northwest of Glasgow Prestwick Airport. Troon has a port with ferry and freight serv ...

Other maritime

* Hart Fenton: a naval architecture and marine engineering company, sold to Houlder in 2006 * Sea Containers Chartering

Railways

: Luxury train service *

(GNER): a

train operating company In the railway system of Great Britain, a train operating company (TOC) is a railway undertaking operating passenger trains under the collective National Rail brand. TOCs have existed since the privatisation of the network under the Railways ...

that commenced operating the

franchise in April 1996. After winning a further 10-year extension when re-tendered in 2005, GNER ran into financial difficulties with Sea Containers handing back the franchise in December 2007.

Containers

The company's container leasing business was conducted mainly through GE SeaCo, a joint venture with

formed in 1998. GE SeaCo was sold to the

HNA Group HNA Group Co., Ltd., was a Chinese conglomerate (company), conglomerate headquartered in Haikou, Hainan, China. Founded in 2000, it was involved in numerous industries including aviation, real estate, financial services, tourism, logistics, and ...

for approximately $1 billion on 15 December 2011 and now operates as Seaco.

Other former activities

* Sea Containers Property Services Ltd – property development, property asset management. *

The Illustrated London News ''The Illustrated London News'', founded by Herbert Ingram and first published on Saturday 14 May 1842, was the world's first illustrated weekly news magazine. The magazine was published weekly for most of its existence, switched to a less freq ...

Group (ILNG) – publishing * Fruit farming – Sea Containers owned plantations in West Africa and South America * Fairways & Swinford – UK-based business travel agency

References

{{reflist Companies formerly listed on the New York Stock Exchange Companies that filed for Chapter 11 bankruptcy in 2006 Defunct companies of Bermuda Shipping companies of Bermuda Container shipping companies Transport companies established in 1965 1965 establishments in Bermuda 2009 disestablishments in Bermuda Transport companies disestablished in 2009