Summary
Royal Caribbean Cruises Ltd. (RCL) announced a significant financing arrangement on November 27, 2013, related to its third Quantum-class ship for the Royal Caribbean International brand. The company secured an unsecured term loan facility of up to approximately $637 million, with a substantial 95% guarantee provided by Euler Hermes Deutschland AG, Germany's official export credit agency. This financing is crucial for funding the construction of a ship scheduled for delivery in the second quarter of 2016.
Key Highlights
- 1RCL entered into a credit agreement for its third Quantum-class ship, valued at approximately $637 million.
- 2The financing is an unsecured term loan, with 95% guaranteed by Euler Hermes Deutschland AG, Germany's export credit agency.
- 3The loan will amortize semi-annually and mature 12 years after the ship's delivery.
- 4Borrowers have the option to choose between a fixed interest rate of 3.32% or a floating rate (LIBOR + 1.00%).
- 5The ship is scheduled for delivery in the second quarter of 2016.
- 6KfW IPEX-Bank GmbH is serving as the lead arranger, facility agent, and an original lender.
- 7The credit agreement includes standard covenants and events of default.
Frequently Asked Questions
The financing agreement is to fund the construction of Royal Caribbean International's third Quantum-class ship, which is expected to be delivered in the second quarter of 2016.
The unsecured term loan is for an amount up to approximately $637 million. It will amortize semi-annually and mature 12 years after the ship's delivery. Borrowers can elect a fixed rate of 3.32% or a floating rate of LIBOR plus 1.00%.
Euler Hermes Deutschland AG, Germany's export credit agency, is providing a 95% guarantee for the financing, significantly reducing the risk for the lenders.
KfW IPEX-Bank GmbH is acting as the initial mandated lead arranger, facility agent, Hermes Agent, and an original lender in this credit agreement.