While the cruise industry continues to look at ways to offset costs during the COVID-19 pandemic, the Royal Caribbean Group has reportedly announced that it has sold its boutique cruise line, Azamara, for USD$201 million.
According to a Jan. 19 press release, the all-cash sale, which is still subject to certain adjustments and closing conditions, was made with private-equity firm Sycamore Partners.
According to a report in the Wall Street Journal, Royal Caribbean Finance Chief Jason Liberty said the deal wasn’t driven by financial reasons and that the company had considered selling Azamara before the pandemic.
As part of the transaction, Sycamore Partners will acquire the Azamara brand, its three-ship fleet and associated intellectual property.
The transaction is expected to close in the first quarter of 2021.
Royal Caribbean Group has noted that the transaction will allows it to focus on expanding its Royal Caribbean International, Celebrity Cruises and Silversea brands.
“Our strategy has evolved into placing more of our resources behind three global brands, Royal Caribbean International, Celebrity Cruises and Silversea, and working to grow them as we emerge from this unprecedented period,” said Richard D. Fain, Chairman and Chief Executive Officer of Royal Caribbean Group, in a press release. “Even so, Azamara remains a strong brand with its own tremendous potential for growth, and Sycamore’s track record demonstrates that they will be good stewards of what the Azamara team has built over the past 13 years.”
The transaction will result in a one-time, non-cash impairment charge of approximately $170 million.
The sale of Azamara is not expected to have a material impact on Royal Caribbean Group’s future financial results, the company said.
“We are pleased that Royal Caribbean Group has entrusted Sycamore to support Azamara in its next phase of growth,” stated Stefan Kaluzny, Managing Director of Sycamore Partners. “We are excited to partner with the Azamara team and build on their many years of success serving the brand’s loyal customers. We believe Azamara will remain a top choice for discerning travelers as the cruising industry recovers over time.”
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