8-KOther EventsExhibits & Filings

ROYAL CARIBBEAN CRUISES LTD 8-K Report, Corporate Update (Oct 14, 2020)

Filed October 14, 2020For Securities:RCL

Summary

On October 13, 2020, Royal Caribbean Cruises Ltd. (RCL) announced the pricing of a significant equity offering and a concurrent convertible notes offering. The company sold 8,333,333 shares of common stock at $60.00 per share, raising substantial capital through this equity sale. Additionally, RCL priced $500 million in aggregate principal amount of 2.875% Convertible Senior Notes due 2023. The proceeds from these offerings are strategically allocated. The convertible notes are intended to be used partly to repay the company's 2.650% Senior Notes due 2020, thereby managing its debt obligations. The remainder of the proceeds from both the equity and convertible notes offerings will be directed towards general corporate purposes. These capital raises are critical for RCL as it navigates the ongoing challenges in the cruise industry, particularly in light of the COVID-19 pandemic.

Key Highlights

  • 1RCL priced an underwritten public offering of 8,333,333 shares of common stock at $60.00 per share.
  • 2The company also priced a concurrent private offering of $500 million in aggregate principal amount of 2.875% Convertible Senior Notes due 2023.
  • 3Net proceeds from the Convertible Notes Offering will be used to repay the 2.650% Senior Notes due 2020 and for general corporate purposes.
  • 4Net proceeds from the Equity Offering will be used for general corporate purposes.
  • 5Both offerings are expected to close on or around October 16, 2020.
  • 6The filing includes a cautionary statement regarding forward-looking statements, highlighting risks related to the COVID-19 pandemic and its impact on the business.
  • 7The convertible notes are offered only to qualified institutional buyers under Rule 144A.

Frequently Asked Questions

The company raised capital from two distinct offerings. The equity offering raised approximately $500 million (8,333,333 shares * $60.00/share). The convertible notes offering raised $500 million in aggregate principal amount. Therefore, the total capital raised from these two offerings is approximately $1 billion.

A portion of the proceeds from the convertible notes will be used to repay the company's 2.650% Senior Notes due 2020. The remaining proceeds from both the equity offering and the convertible notes offering will be used for general corporate purposes.

The filing emphasizes the significant and ongoing impact of the COVID-19 pandemic, including travel restrictions, cruise suspensions, and reduced demand. Other risks mentioned include liquidity needs, economic and geopolitical factors, safety concerns, competition, regulatory changes, and potential debt-related impacts such as dilution from convertible note conversions.

The Convertible Senior Notes are being offered only to persons reasonably believed to be qualified institutional buyers in reliance on Rule 144A under the Securities Act.