NCL confirms Prestige takeover
Nasdaq-listed Norwegian Cruise Line (NCL) has confirmed reports it is buying US operator Prestige Cruises for $3.025bn, including debt.
The Malaysian-owned cruiseship company said Prestige, which runs Oceania Cruises and Regent Seven Seas, is the market leader in the “upscale” cruise sector.
NCL will pay an extra amount of up to $50m to Prestige shareholders depending on certain performance targets in 2015.
The transaction is subject to regulatory approvals, but is expected to close in the fourth quarter.
NCL is financing the move with existing cash, new and existing debt and 20.3m new shares.
“The acquisition of Prestige represents an extraordinary opportunity for Norwegian Cruise Line to expand our market presence by adding two established, award-winning brands in the upscale cruise segment with loyal followings,” said Kevin Sheehan, NCL’s CEO.
He added that “meaningful synergies” can be quickly implemented, adding to earnings.
Prestige CEO Frank Del Rio said: “We are excited to become part of the Norwegian family and start a new chapter for our company.”
The companies said their global reach would also be expanded.
SunTrust analyst Patrick Scholes said in a note to clients that the takeover made sense for NCL, as it gave it immediate exposure to higher-end brands and allowed it to diversify out of the “capacity-flooded” Caribbean market.
He called the price “fairly attractive.”
Stifel analyst Steven Wieczynski said Prestige’s up-market offering could go over well in growth markets like China and India.
Prestige’s owner is private equity fund Apollo Global Management, which also has 20\% of NCL, whose biggest shareholder is Malaysia’s Genting, owner of Star Cruises.
NCL has 13 cruiseships, while Miami-based Prestige operates five vessels under the Oceania Cruises brand and three more as Regent Seven Seas.
The company also has a 738-berth newbuilding due from Fincantieri in Italy in 2016.
Prestige filed for a $250m IPO with US regulators in January. NCL carried out its own IPO in 2013 in New York.
source:tradewindsnews.com
