Oceania Cruises is taking ownership of the
three ships in its fleet, the Regatta, the Insignia and the
Nautica, which it has been operating under long-term lease from
Cruiseinvest, LLC, Oceania said.
"By acquiring the
vessels, the company expects to significantly reduce overall
capital expenditures and carrying costs of operating the vessels,
which will have a positive effect on [earnings before interest,
taxes, depreciation and amortization] going forward," said Frank
Del Rio, the president and CEO of Oceania Cruises, in a
statement.
Taking ownership of
our vessels and the recently executed credit facility have
perfectly positioned Oceania Cruises to enter its next phase of
growth," he said. "With our enhanced financial performance and
flexibility, we can now focus on fleet expansion."
After completing a
bank debt offering that consists of a $300 million six-year term
loan, a $75 million seven-year term loan and a $25 million
five-year revolving credit facility, Oceania said it used the
proceeds of the credit to acquire Oceania's three, 684-passenger
vessels for a total cost of $375 million.
Oceania said that
between 2003 and 2006 its yields per guest increased by 41% and
occupancy levels remained consistently close to capacity. It also
said it has a high degree of earnings visibility, with more than
72% of the available occupancy for 2007 and 30% of the available
occupancy for 2008 booked as of November 2006.
UBS Securities and
Lehman Brothers acted as financial advisors for the transaction and
underwrote the credit facilities with a syndicate of North American
and European financial institutions, Oceania said.
The line said it will
not make any changes to the ships' onboard operations. Monaco-based
V.ships will remain the marine and technical managers for the
fleet, while ICS, a subsidiary of Miami-based Apollo Ship
Chandlers, will continue to provide hotel services.
To contact the
reporter who wrote this article, send e-mail to Johanna Jainchill
at[email protected].