Summary
Carnival Corporation (CCL) announced on October 8, 2021, the successful syndication and pricing of a $2.3 billion first-priority senior secured term loan facility. This new facility is slated to close on October 18, 2021, and its primary purpose is to redeem the company's 11.5% First Priority Senior Secured Notes due 2023. The refinancing is expected to result in substantial annual interest savings of over $135 million and extend the company's debt maturities to 2028. This strategic move demonstrates Carnival's efforts to strengthen its financial position by reducing interest expenses and improving its debt maturity profile. The new term loan facility carries a floating interest rate (adjusted LIBOR with a 0.75% floor) plus a 3.25% margin. The company also issued a conditional notice for the full redemption of the 2023 Notes, contingent upon the successful closing of the new term loan facility and receipt of sufficient funds.
Key Highlights
- 1Successfully priced a $2.3 billion first-priority senior secured term loan facility.
- 2New term loan facility matures in 2028, extending debt maturities.
- 3Annual interest savings are projected to exceed $135 million.
- 4Proceeds will be used to redeem the 11.5% First Priority Senior Secured Notes due 2023.
- 5The new facility has an interest rate of adjusted LIBOR + 3.25% with a 0.75% floor.
- 6The transaction is expected to close on October 18, 2021, subject to customary conditions.
- 7A conditional notice of redemption for the 2023 Notes has been issued.