Summary
Royal Caribbean Cruises Ltd. (RCL) announced a significant financial transaction on December 11, 2014, concerning its cruise ship 'Brilliance of the Seas.' The company terminated its 25-year operating lease, originally established in July 2002, and purchased the vessel for approximately $275 million. This strategic move effectively converts an operating lease into an owned asset.
Key Highlights
- 1RCL acquired the 'Brilliance of the Seas' for approximately $275 million, terminating its existing operating lease.
- 2The acquisition was funded through drawings under the company's existing revolving credit facilities.
- 3RCL increased its revolving credit capacity by $300 million by exercising the accordion feature on its revolving credit facility due August 2018.
- 4This transaction is not expected to result in any gain or loss for the company.
- 5The event signifies a shift from an operating lease to direct ownership of a key asset.
- 6The refinancing was effective as of December 12, 2014.