Summary
Royal Caribbean Cruises Ltd. (RCL) announced on January 18, 2007, the pricing of a significant debt offering: €1,000,000,000 in 5.625% Senior Notes due 2014. This offering is a strategic move primarily aimed at refinancing short-term debt incurred from the recent acquisition of Pullmantur S.A. and its associated debt repayment. Any remaining proceeds will be allocated to general corporate purposes, indicating a focus on strengthening the company's financial position post-acquisition. The terms of the Senior Notes include annual interest payments in euros, with a provision requiring the company to repurchase the notes at 101% of their principal amount plus accrued interest if a Change of Control Triggering Event occurs, coupled with a specified rating downgrade. This feature provides a level of protection for investors against significant changes in the company's ownership or financial stability. The notes are not registered under the U.S. Securities Act of 1933, meaning they are not offered or sold within the United States without appropriate registration or exemption.
Key Highlights
- 1RCL priced an offering of €1,000,000,000 in 5.625% Senior Notes due 2014.
- 2The primary use of proceeds is to refinance short-term debt related to the acquisition of Pullmantur S.A.
- 3The Senior Notes will bear interest at a rate of 5.625% per annum, payable annually in euros.
- 4A Change of Control Triggering Event requires RCL to offer to repurchase the notes at 101% of the principal amount.
- 5The notes are subject to repurchase if a change of control occurs and is accompanied by a rating downgrade by specified agencies.
- 6RCL can redeem the notes at par plus accrued interest in case of certain changes in Liberian tax law.
- 7The Senior Notes are not registered under the U.S. Securities Act of 1933 and are subject to restrictions on U.S. offering or sale.