BY ERNEST BLUM
MIAMI -- Norwegian Cruise Lines said it plans to acquire three
ships.
These include the two ships operated by Majesty Cruise Line --
the 1,050-passenger Royal Majesty and the 800-passenger Crown
Majesty -- and a new, 2,000-passenger ship to be delivered by June
of 1999.
"Once again NCL is on the move in a major way," NCL president
Hans Golteus said.
"These actions verify our long-standing strategic plans for
aggressive expansion of the NCL fleet."
The deals involve the purchase of the Royal Majesty, including
business on the books, for $110 million in cash and almost 20% of
NCL's stock from Monarch Holdings, which owns the ship and
Majesty.
Norway industrial giant Kvaerner PLC, which owns 90% of Monarch,
would become NCL's second largest shareholder. Kvaerner also owns
all of Cunard.
Kvaerner said the NCL stock is worth $80 million, but NCL
retains a one-year option to buy back the shares for $71
million.
The deal is contingent on NCL obtaining the requisite
financing.
The transaction is expected to spell the eventual phasing out of
Majesty, which, however, would continue to market the Royal Majesty
and Crown Majesty for the remainder of their published 1997
schedules.
Golteus said that his company expects to announce shortly the
1998 schedules for the Royal Majesty (built in 1992) and the Crown
Majesty (built in 1993) under the NCL banner.
He said NCL would take delivery of the Royal Majesty in April of
this year and would enter the Crown Majesty into its fleet during
the fourth quarter of 1997.
Golteus said that sometime this year NCL "seamlessly" would take
over the sales and marketing of the two ships from Majesty.
Added Bruce Nierenberg, executive vice president of NCL, "We are
committed to making the operational transition between Majesty and
NCL a seamless process to avoid any inconveniences to travel agents
or the passengers.
"There will be no disruption of service whatsoever."
On April 28, Majesty will enter the Royal Majesty into its
announced summer season from Boston to Bermuda, according to
Majesty president Paris Katsoufis, who reported much of the season
already is sold out.
The ship this autumn returns to Miami for three- and four-day
Bahamas sailings.
NCL also acquired Majesty's remaining seven-year rights to
operate the Royal Majesty in Bermuda, where the ship would
supplement NCL's Dreamward.
Golteus indicated that NCL now planned to operate two ships in
Bermuda.
The Crown Majesty (formerly the Crown Dynasty) had been operated
by Cunard under a charter agreement with Silja Line that extends
into 1999.
Majesty just took over operation of the ship and on May 17 will
enter it into its announced Alaska season.
In the fall, the vessel will offer 10- and 11-day Panama Canal
sailings.
Majesty will operate that program, said Katsoufis, until NCL
takes over the operation of the ship for the remainder of Cunard's
1999 charter.
Golteus said NCL still is negotiating details of that
agreement.
Golteus said that NCL signed a letter of intent to order its
planned new building from Finland's Kvaerner Masa Yard (also owned
by Kvaerner).
The ship would be NCL's first new ship since 1993.
This is in addition to still another new vessel that NCL plans
to build on the hull of the uncompleted CostaOlympia, which NCL
plans to acquire for $30 million.
Should NCL wind up with all four ships, the line would have 11
ships in its fleet.
Included in that number are two other ships, the Norwegian Crown
and the Norwegian Star, formerly operated by Royal Cruise Line,
acquired since 1996.
Golteus said NCL plans to obtain financing for its ambitious
plans with a mix of debt and equity, preventing the company, which
until last year was on the brink of bankruptcy, from overextending
itself financially.
In a related development, Kvaerner reported that NCL is planning
to list its stock in the U.S. later this year.