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Royal Caribbean arranges loan for portion of Silversea stakeRoyal Caribbean arranges loan for portion of Silversea stake

Royal Caribbean Cruises Ltd. entered into a 364-day unsecured term loan agreement to finance part of the purchase price for a 66.7% stake in Silversea Cruises.

Anne Kalosh, Editor, Seatrade Cruise News & Senior Associate Editor, Seatrade Cruise Review

July 5, 2018

1 Min Read
Credit: Seatrade Cruise News

RCL is paying $1bn and assuming about $500m in debt for the Silversea deal.

Aggregate principal amount up to $700m

The loan agreement makes available to RCL on any single business day an aggregate principal amount not to exceed $700m in the form of term loans denominated in US dollars. The interest rate will range from a rate equal to LIBOR plus a margin of 0.9% to 1.5% per annum or a base rate plus a margin of 0% to 0.5% per annum, depending on RCL’s senior debt rating.

After a 60-day grace period, and until the commitments of the lenders have terminated, RCL will pay the lenders a ticking fee equal to a percentage ranging from 0.08% to 0.2% per annum, depending on the company's senior debt rating. The commitments of the lenders to make advances will terminate on the earlier of the date of funding and Nov.15, 2018. The obligations of the lenders to fund any borrowing became effective on July 2, and the advances will mature 364 days thereafter.

The loan agreement requires that RCL prepay the outstanding principal amount of any advances in the event the acquisition is not consummated within 10 business days after the date of funding and with 100% of the net cash proceeds of debt for borrowed money.

Joint lead arrangers and book runners

JPMorgan Chase Bank, NA; Citigroup Global Markets Ltd.; Goldman Sachs Bank USA; Merrill, Lynch, Pierce, Fenner & Smith Inc.; and Morgan Stanley Senior Funding Inc. are joint lead arrangers and joint book runners.

JPMorgan Chase Bank, NA is administrative agent and Bank of America, NA; Citigroup Global Markets Ltd., Goldman Sachs Bank USA and Morgan Stanley Senior Funding Inc. are co-syndication agents.

About the Author

Anne Kalosh

Editor, Seatrade Cruise News & Senior Associate Editor, Seatrade Cruise Review

Anne Kalosh covers global stories, reporting both breaking and in-depth news on cruising's significant people, places, ships and trends. A sought-after expert on cruising, she has moderated conferences around the world, including the high-profile State of the Industry panel at Seatrade Cruise Global. She created and led the acclaimed itinerary-planning case study for Seatrade's cruise master classes held at Cambridge and Oxford universities. She has been the cruise columnist for AFAR.com, and her freelance stories have appeared in a wide range of publications, from The New York Times to The Miami Herald.

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