Mondee Holdings, a publicly traded travel technology company that operates an AI-powered booking platform and one of the largest air ticket consolidator networks in North America, voluntarily filed for Chapter 11 bankruptcy protection on January 14, 2025, in the District of Delaware. The Austin-based company, which was delisted from NASDAQ in December 2024, entered bankruptcy with a pre-negotiated restructuring agreement that includes a $191 million stalking horse bid from its existing secured lenders.

The restructuring support agreement contemplates a credit bid from affiliates of TCW Asset Management Company and Wingspire Capital, with company founder and former CEO Prasad Gundumogula positioned to hold a 75% equity stake in the reorganized entity while returning as chief executive. The lenders committed $27.5 million in new-money debtor-in-possession financing to fund operations during the Chapter 11 process, supplementing $21.5 million recently provided through prepetition amendments.

Business Operations and Market Position

Founded in 2011, Mondee built its business through strategic acquisitions of major air ticket consolidators in the United States and Canada, establishing itself as a significant marketplace for negotiated airfares. The company operates a multi-faceted travel technology platform that processes over 50 million searches daily and generates more than 5 million airline transactions annually.

Mondee's multi-faceted business model includes four core components: (1) an AI-powered transaction platform utilizing large language models and proprietary probabilistic learning models to personalize travel experiences, (2) the Mondee Marketplace connecting suppliers with customers for unsold airline seats, hotel rooms, and cruise cabins, (3) a distribution network of 65,000 travel experts with access to 125 million travelers, and (4) 24/7 multilingual support centers across multiple channels. The company maintains operations globally with entities in Brazil, Mexico, India, Canada, and Thailand, though only the U.S.-based entities filed for bankruptcy.

During the COVID-19 pandemic, the company completed strategic acquisitions to expand beyond air travel into lodging, hotels, car rentals, and cruises—transactions partially funded with a $150 million term loan obtained in 2020. By 2023, Mondee had integrated artificial intelligence capabilities into its platform, positioning itself as a technology-driven alternative to traditional travel distribution models.

Path to Bankruptcy: From SPAC to Chapter 11

Mondee's financial challenges originated from a confluence of factors beginning with its ambitious expansion in 2019-2020. The company funded major acquisitions with a $150 million term loan just before the COVID-19 pandemic devastated the global travel industry. To preserve liquidity during the downturn, Mondee opted for payment-in-kind (PIK) interest on its debt, which unexpectedly inflated its leverage ratio beyond sustainable levels. The timing of these acquisitions, including one that expanded Mondee into the business-to-consumer market, proved particularly unfortunate as travel demand collapsed globally.

The company went public through a SPAC merger with ITHAX Acquisition Corp. in July 2022, expecting to raise $240 million plus $70 million in PIPE financing. However, the transaction fell far short of targets, and the additional burden of public company compliance costs diverted resources from core operations. The stock price subsequently declined, making it impossible to raise equity for debt refinancing. Rather than accessing common equity markets, the company relied on higher-cost secured debt and preferred stock, limiting its access to working capital.

Between October 2023 and March 2024, Mondee's investment bankers contacted 35 potential refinancing partners without success, despite significant resources invested in the effort. The company faced additional headwinds from increased industry competition, including the loss of key sales employees to competitors, which made it difficult to capture volume-based contract incentives. Variable interest rates on the debt climbed over 5% due to global inflation, substantially increasing debt service costs.

By the petition date, Mondee's prepetition debt totaled approximately $231 million in principal, structured as $18.9 million in Term Loan A, $212.1 million in Term Loan B, and $762,682 in revolving loans, with maturity set for June 30, 2028. The company secured $21.5 million in bridge financing through three credit facility amendments in late 2024 and early 2025, providing critical liquidity while management implemented workforce reductions, pay cuts, and hiring freezes.

Restructuring Support Agreement and Sale Process

Mondee entered Chapter 11 with a pre-negotiated Restructuring Support Agreement backed by prepetition lenders TCW Asset Management Company and Wingspire Capital. The stalking horse credit bid of $191 million consists of all outstanding DIP facility obligations plus a portion of prepetition debt, with the transaction structure creating a new entity where company founder Prasad Gundumogula would hold 75% equity and return as CEO while TCW and Wingspire retain minority stakes.

The financing package includes $27.5 million in new-money DIP financing plus the $21.5 million previously provided, with the total DIP facility reaching $110 million: $20 million interim new money, $7.5 million final new money, and $82.5 million in rolled-up prepetition loans. The stalking horse bidders agreed to assume contract cure costs up to a specified cap and fund estate wind-down expenses.

Piper Sandler's prepetition marketing efforts contacted approximately 60 potential buyers, generating two inbound inquiries and term sheet negotiations with one party beyond the stalking horse. The 100-day bankruptcy timeline included court-scheduled milestones for bidding procedures, DIP approval, and sale closing. The restructuring committee of three independent directors, formed in November 2024, approved this path with Chief Restructuring Officer Mohsin Meghji of M3 Advisory Partners overseeing execution. The RSA preserved flexibility to pursue higher bids and terminate if fiduciary duties required.

Post-Filing Developments and Unexpected Liquidation

On April 4, 2025, Tabhi acquired substantially all of Mondee's assets, with ownership split among affiliates of TCW, Morgan Stanley Investment Management, and Prasad Gundumogula, who retained majority control and the CEO position. The transaction reportedly cut debt approximately in half while injecting new equity, with TCW serving as administrative agent for the new credit facility alongside Morgan Stanley Investment Management and Wingspire as participants.

The successful sale closing appeared to validate the expedited 100-day Chapter 11 timeline, preserving the business as a going concern under familiar leadership. Yet two weeks earlier, on March 20, 2025, the debtors filed an emergency motion to convert to Chapter 7 liquidation, citing post-sale cash constraints and unexpected tax liabilities that prevented orderly administrative wind-down.

The liquidation request exposed the complexities inherent in winding down multi-jurisdictional travel technology operations. Chapter 7 conversion would shift responsibility to a court-appointed trustee for distributing remaining assets and resolving claims, potentially reducing administrative costs while removing management burden. This development illustrates how even well-executed bankruptcy sales can encounter unforeseen post-closing obligations that fundamentally alter case outcomes.

Strategic Implications for Travel Technology Sector

Mondee's bankruptcy highlights persistent vulnerabilities in travel technology companies that expanded aggressively pre-pandemic. The case demonstrates how failed SPAC transactions can trigger financial distress when anticipated funding falls short—Mondee's 2022 de-SPAC raised far less than the targeted $240 million, while public company compliance costs drained resources from operations.

Prasad Gundumogula's retention as majority owner and CEO in the reorganized entity, despite presiding over the company's decline, reflects the premium placed on founder knowledge and industry relationships in travel technology platforms. The structure granting him 75% equity while relegating lenders TCW and Wingspire to minority positions indicates lenders' willingness to accept significant debt reduction to preserve going-concern value.

The rapid progression from negotiated sale to liquidation request underscores counterparty risk persistence even after successful restructurings. Post-sale tax liabilities and cash constraints exposed the complexity of winding down multi-jurisdictional travel operations. While non-U.S. entities in Brazil, Mexico, India, and Canada remained outside bankruptcy proceedings, parent company distress inevitably impacts global operations.

Market conditions proved challenging despite Mondee's operational scale—50 million daily searches and 5 million annual airline transactions attracted limited buyer interest beyond the insider-led stalking horse. Piper Sandler's outreach to 60 potential acquirers yielded only two inbound inquiries, suggesting valuation difficulties persist for traditional consolidator models facing direct supplier distribution and new technology platforms. The bankruptcy's timing, months after September 2024 debt extensions to 2028, demonstrates how quickly leveraged travel technology companies can deteriorate.

Mondee's case illustrates fundamental tensions in travel technology restructurings: platforms retain value to support going-concern sales, yet leverage and public market obligations often prove fatal. Industry participants should maintain flexible capital structures and realistic growth expectations in a sector where technological disruption and external shocks rapidly erode margins. For continued coverage of significant Chapter 11 filings in technology and travel sectors, visit ElevenFlo's bankruptcy blog.