Royal Caribbean Group announces upsizing and pricing of $2.0 billion offering of senior unsecured notes to refinance certain series of its senior notes due 2029
Royal Caribbean Group (NYSE: RCL) has upsized and priced a $2.0 billion offering of senior unsecured notes due 2033, increased from the previously announced $1.5 billion. The notes, with a 6.000% interest rate, are expected to be issued around August 12, 2024. Proceeds will be used to redeem all outstanding 9.250% Senior Notes due 2029 and 8.250% Senior Secured Notes due 2029, comprising the company's remaining secured indebtedness. This refinancing move aims to optimize Royal Caribbean's debt structure. The offering is to qualified institutional buyers and certain non-U.S. persons, with the notes not being registered under the Securities Act.
Royal Caribbean Group (NYSE: RCL) ha aumentato e fissato un'offerta di 2,0 miliardi di dollari di obbligazioni senior non garantite con scadenza nel 2033, rispetto ai 1,5 miliardi precedentemente annunciati. Le obbligazioni, con un tasso di interesse del 6,000%, sono previste per essere emesse intorno al 12 agosto 2024. I proventi saranno utilizzati per riscattare tutti i 9,250% Senior Notes in circolazione con scadenza nel 2029 e gli 8,250% Senior Secured Notes con scadenza nel 2029, comprendendo il debito garantito restante della compagnia. Questa operazione di rifinanziamento mira a ottimizzare la struttura del debito di Royal Caribbean. L'offerta è destinata a investitori istituzionali qualificati e a determinate persone non statunitensi, con le obbligazioni che non vengono registrate ai sensi del Securities Act.
Royal Caribbean Group (NYSE: RCL) ha ampliado y fijado una oferta de 2.0 mil millones de dólares en notas senior no garantizadas con vencimiento en 2033, aumentada desde los 1.5 mil millones previamente anunciados. Las notas, con un tasa de interés del 6.000%, se espera que se emitan alrededor del 12 de agosto de 2024. Los ingresos se utilizarán para redimir todas las 9.250% Senior Notes pendientes que vencen en 2029 y las 8.250% Senior Secured Notes que vencen en 2029, que comprenden la deuda asegurada restante de la compañía. Este movimiento de refinanciamiento tiene como objetivo optimizar la estructura de deuda de Royal Caribbean. La oferta está destinada a compradores institucionales calificados y a ciertas personas no estadounidenses, y las notas no están registradas bajo la Ley de Valores.
로열 캐리비안 그룹(Royal Caribbean Group, NYSE: RCL)은 2033년 만기 senior unsecured notes를 20억 달러 규모로 확대 및 가격 책정했습니다, 이는 이전에 발표된 15억 달러에서 증가한 것입니다. 이 노트는 6.000%의 이자율을 가지며, 2024년 8월 12일경 발행될 예정입니다. 자금은 2029년 만기 9.250% Senior Notes와 8.250% Senior Secured Notes를 모두 상환하는 데 사용될 것입니다, 이는 회사의 남은 담보 채무를 포함합니다. 이번 리파이낸싱 조치는 로열 캐리비안의 부채 구조를 최적화하는 것을 목표로 하고 있습니다. 이 제안은 자격을 갖춘 기관 투자자와 특정 비미국인에게 제공되며, 노트는 증권 법에 따라 등록되지 않습니다.
Royal Caribbean Group (NYSE: RCL) a augmenté et fixé une offre de 2,0 milliards de dollars d'obligations senior non garanties arrivant à échéance en 2033, en hausse par rapport aux 1,5 milliard de dollars précédemment annoncés. Les obligations, avec un taux d'intérêt de 6,000%, devraient être émises autour du 12 août 2024. Les produits seront utilisés pour racheter toutes les 9,250% Senior Notes en circulation arrivant à échéance en 2029 et les 8,250% Senior Secured Notes arrivant à échéance en 2029, comprenant la dette sécurisée restante de la société. Ce mouvement de refinancement vise à optimiser la structure de la dette de Royal Caribbean. L'offre est destinée à des investisseurs institutionnels qualifiés et à certaines personnes non américaines, les obligations n'étant pas enregistrées conformément à la loi sur les valeurs mobilières.
Royal Caribbean Group (NYSE: RCL) hat ein Angebot von 2,0 Milliarden Dollar an unbesicherten vorrangigen Anleihen mit Fälligkeit 2033 aufgestockt und festgelegt, erhöht von den zuvor angekündigten 1,5 Milliarden. Die Anleihen haben einen Zinssatz von 6,000% und sollen um den 12. August 2024 ausgegeben werden. Die Erlöse werden verwendet, um alle ausstehenden 9,250% Senior Notes mit Fälligkeit 2029 und 8,250% Senior Secured Notes mit Fälligkeit 2029 einzulösen, die die verbleibenden gesicherten Verbindlichkeiten des Unternehmens darstellen. Diese Refinanzierung soll die Verschuldungsstruktur von Royal Caribbean optimieren. Das Angebot richtet sich an qualifizierte institutionelle Käufer und bestimmte nicht-US-Personen, wobei die Anleihen nicht unter dem Wertpapiergesetz registriert werden.
- Upsizing of the offering from $1.5 billion to $2.0 billion indicates strong investor demand
- Lower interest rate of 6.000% compared to the notes being redeemed (9.250% and 8.250%)
- Refinancing eliminates all remaining secured indebtedness, potentially improving financial flexibility
- Increase in total debt by $2.0 billion
- Reliance on additional borrowings from revolving credit facilities to complete the redemption
Insights
Royal Caribbean's $2.0 billion senior unsecured notes offering marks a significant shift in the company's debt structure and financial strategy. This move to refinance existing high-interest debt with lower-cost capital is a shrewd financial maneuver that could yield substantial benefits:
- Interest Savings: The new notes, priced at
6.000% , represent a considerable reduction from the9.250% and8.250% rates on the notes being redeemed. This could potentially save the company$60 million to$80 million in annual interest expenses. - Debt Profile Improvement: By replacing secured debt with unsecured notes, Royal Caribbean is freeing up assets and enhancing its financial flexibility. This could improve its credit profile and potentially lead to future rating upgrades.
- Extended Maturity: The new 2033 maturity pushes out the company's debt obligations, providing more breathing room and reducing near-term refinancing pressures.
However, investors should note that while this refinancing is positive, it doesn't reduce the company's overall debt load. The cruise industry's recovery trajectory and Royal Caribbean's ability to generate strong cash flows will remain important factors in its long-term financial health.
This refinancing move by Royal Caribbean signals several important market trends:
- Improved Credit Markets: The upsizing of the offering from
$1.5 billion to$2.0 billion suggests strong investor demand for cruise line debt, indicating growing confidence in the sector's recovery. - Industry Normalization: The ability to issue unsecured debt at more favorable rates points to a normalization of the cruise industry's risk profile in the eyes of investors, a marked improvement from the pandemic era.
- Strategic Timing: Royal Caribbean is capitalizing on the current interest rate environment before potential future rate hikes, locking in lower costs for an extended period.
This transaction may set a precedent for other cruise lines and travel-related companies to refinance their high-cost debt incurred during the pandemic. It could trigger a wave of similar offerings in the sector, potentially leading to improved financial health across the industry. Investors should watch for comparable moves from competitors, as this could reshape the competitive landscape in terms of financial flexibility and operational capabilities.
The Company intends to use the proceeds from the sale of the Notes, together with borrowings under the Company's revolving credit facilities, to redeem (i) all of its outstanding
The Notes are being offered only to persons reasonably believed to be qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"), and outside
This press release shall not constitute an offer to sell or a solicitation of an offer to buy the Notes or any other securities and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offer, solicitation or sale would be unlawful. This press release shall not constitute a notice of redemption with respect to either of the Company's
Special Note Regarding Forward-Looking Statements
Certain statements in this press release relating to, among other things, the offering and sale of the Notes constitute forward-looking statements under the Private Securities Litigation Reform Act of 1995. These statements include, but are not limited, to: statements regarding the expected timing for the closing of the offering of the Notes and the intended use of proceeds. Words such as "anticipate," "believe," "considering," "could," "driving," "estimate," "expect," "goal," "intend," "may," "plan," "project," "seek," "should," "will," "would" and similar expressions are intended to help identify forward-looking statements. Forward-looking statements reflect management's current expectations, but they are based on judgments and are inherently uncertain. Furthermore, they are subject to risks, uncertainties and other factors that could cause the Company's actual results, performance or achievements to differ materially from the future results, performance or achievements expressed or implied in those forward-looking statements. Examples of these risks, uncertainties and other factors include, but are not limited to, the following: the impact of the economic and geopolitical environment on key aspects of the Company's business, such as the demand for cruises, passenger spending, and operating costs; changes in operating and financing costs; the unavailability or cost of air service; adverse events such as terrorist attacks, war and other similar events; disease outbreaks and an increase in concern about the risk of illness on the Company's ships or when traveling to or from the Company's ships, all of which could reduce demand; incidents or adverse publicity concerning the Company's ships, port facilities, land destinations and/or passengers or the cruise vacation industry in general; the effects of weather, natural disasters and seasonality on the Company's business; the impact of issues at shipyards, including ship delivery delays, ship cancellations or ship construction cost increases; shipyard unavailability; vacation industry competition and changes in industry capacity and overcapacity; unavailability of ports of call; an inability to source the Company's crew or the Company's provisions and supplies from certain places; the uncertainties of conducting business internationally and expanding into new markets and new ventures; the Company's ability to obtain sufficient financing, capital or revenues to satisfy liquidity needs, capital expenditures, debt repayments and other financing needs; the Company's indebtedness, any additional indebtedness the Company may incur and restrictions in the agreements governing the Company's indebtedness that limit the Company's flexibility in operating its business; changes in foreign travel policy of
Forward-looking statements should not be relied upon as predictions of actual results. Undue reliance should not be placed on the forward-looking statements in this release, which are based on information available to the Company on the date hereof. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
About Royal Caribbean Group
Royal Caribbean Group (NYSE: RCL) is a vacation industry leader with a global fleet of 68 ships across its five brands traveling to approximately 1,000 destinations. With a mission to deliver the best vacations responsibly, Royal Caribbean Group serves millions of guests each year through its portfolio of best-in-class brands, including Royal Caribbean International, Celebrity Cruises, and Silversea; and expanding portfolio of land-based vacation experiences through Perfect Day at CocoCay and Royal Beach Club collection. The company also owns
Investor Relations contact: Blake Vanier
Email: bvanier@rccl.com
Media contact: Melissa Castro
Email: corporatecommunications@rccl.com
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SOURCE Royal Caribbean Group
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