Summary
Carnival Corporation & plc announced on March 1, 2023, the entry into a new $2.1 billion forward-starting multi-currency revolving credit agreement for its subsidiary, Carnival Holdings (Bermuda) II Limited. This new facility, effective August 6, 2024, will replace the existing credit agreement upon its expiration and includes an accordion feature allowing for potential expansion up to $2.9 billion. The facility aims to provide general liquidity and working capital, supporting commercial paper programs and other financing needs. Notably, the new credit agreement introduces an emissions-linked margin adjustment, incentivizing the company to meet certain carbon emission goals. The terms are largely similar to the existing facility, with cross-guarantees from Carnival Corporation and Carnival plc, and the pledge of three unencumbered vessels as collateral. The agreement underscores Carnival's commitment to managing its liquidity and potentially incorporating sustainability targets into its financing arrangements.
Key Highlights
- 1Carnival entered into a new $2.1 billion forward-starting multi-currency revolving credit agreement effective August 6, 2024, replacing the existing facility.
- 2The new facility has an accordion feature, allowing for potential expansion of commitments up to an aggregate of $2.9 billion.
- 3Borrowings will be based on SOFR, EURIBOR, or SONIA, plus a margin tied to Carnival Corporation's credit ratings.
- 4A key feature is an emissions-linked margin adjustment, linking the interest rate to the achievement of annual carbon emission goals.
- 5The facility will be used for general liquidity, working capital, and to support commercial paper programs.
- 6Carnival Corporation and Carnival plc, along with certain subsidiaries, have provided guarantees for the obligations under the new facility.
- 7Three unencumbered vessels will be contributed to the subsidiary for the new facility.