The loans are for 80% of the contract price for each ship, which is not to exceed €1.65bn, according to a filing. This includes a built-in cushion of €300m for non-yard costs and future change orders.
Royal Caribbean also extended its $1.15bn unsecured revolving credit facility until October 2022 and can increase the facility by an additional $500m from time to time subject to the receipt of additional or increased lender commitments.
One year ago, the company announced a memorandum of understanding with Meyer Turku for a pair of approximately 200,000gt ships with about 5,000 lower berths for a new 'Icon' class. The ships would be powered by LNG and use fuel cell technology for a dramatic reduction in greenhouse gas emissions.
The newbuild financing agreements each provide an unsecured US-dollar-denominated term loan, most of which is guaranteed 100% by Finnvera, Finland's export credit agency. Euler Hermes, Germany's export credit agency, has also agreed to provide a 95% guarantee for a smaller portion of the financing.
The maximum amount of each facility is equal to the US dollar equivalent of 80% of the vessel price plus 100% of the guarantee premiums payable to Finnvera and Hermes.
Each loan will amortize semi-annually and will mature 12 years following each ship's delivery. Approximately 75% of each loan will accrue interest at a fixed rate of 3.56% in the case of the first Project Icon vessel, and 3.76%, in the case of the second.
The balance of each loan will accrue interest at a floating rate ranging from LIBOR plus 1.1% to LIBOR plus 1.15% in the case of the first Project Icon vessel, and from LIBOR plus 1.15% to LIBOR plus 1.2%, in the case of the second.
The lenders are KfW IPEX-Bank as facility agent, Hermes agent and initial mandated lead arranger, BNP Paribas Fortis as Finnvera agent, and HSBC Bank plc, Commerzbank AG, New York Branch and Banco Santander S.A. as other mandated lead arrangers. Banco Bilbao Vizcaya Argentaria, S.A., Niederlassung Deutschland, Bayerische Landesbank, New York Branch; DZ Bank AG, New York Branch; JPMorgan Chase Bank, N.A., London Branch; and Sumitomo Mitsui Banking Corp. Europe Ltd. are lead arrangers.