Carnival Corp. signed a definitive
agreement to sell Windstar Cruises to Ambassadors International for
$100 million.
Seattle-based
Windstar Cruises is a wholly owned subsidiary of Holland America
Line, a unit of Carnival Corp. Windstar operates three sailing
vessels with a total lower-berth capacity of 772.
"We made the
decision to exit from the niche cruise business some time ago and
the sale of Windstar is in line with that strategy," said Carnival
Corp. chairman and CEO Micky Arison. "Last year we made a decision
to cease operation of UK's Swan Hellenic and transfer its one ship
to the Princess Cruises brand. Both of these are excellent products
but simply do not fit into our future growth plans."
Arison said that
the company's growth strategy is now focused on expanding "core
growth brands and opening new markets."
He also said that
"Windstar is an outstanding and unique cruise product and has
garnered an extremely loyal following".
Carnival said that
under the terms of the agreement, Windstar will be sold for $100
million, $40 million of which is payable in cash and assumption of
liabilities, and $60 million that Carnival will provide mortgage
financing for. The loan will be payable over 10 years at 7%
interest, collateralized by the three Windstar ships.
"We are pleased to
have a committed buyer like Ambassadors International to take over
Windstar," said Stein Kruse, president and CEO of Holland America
Line. "The transaction has been structured to ensure a smooth
transition for all parties. Holland America Line will continue to
operate the company through a transitional services agreement in
the short term which includes vessel, reservations and other
operational functions."
Carnival said it
expects the transaction to close in the second quarter of 2007,
subject to any applicable regulatory requirements.
To
contact reporter Johanna Jainchill, send e-mail to [email protected].