NCL in talks to acquire Prestige

[Needzavacation]

Looks like Regent may get a new owner:

 

(Reuters) - Norwegian Cruise Line Holdings Ltd, the world's third largest cruise operator, is in advanced talks to acquire peer Prestige Cruises International Inc for around $3 billion (1.8 billion pounds), according to people familiar with the matter.

 

A deal would give Norwegian Cruise, a company with a market value of $6.8 billion, access to Prestige Cruises' luxury cruise ships and affluent clientele as it competes with bigger rivals Royal Caribbean Cruises Ltd and Carnival Corp.

 

An agreement may be announced as early as this week, the sources said on Sunday, cautioning that the talks could still fall apart. The owner of Prestige Cruises, private equity firm Apollo Global Management LLC, also owns a 20 percent stake in Norwegian Cruise.

 

The sources asked not to be identified because the negotiations are not public. Norwegian Cruise and Prestige Cruises representatives did not respond to requests for comment, while an Apollo spokesman declined to comment.

[xrvlcruiser]

interesting

[TedC]

I like the sound of Prestige better than Norwegian.

[Travelcat2]

Really not worried.

[tallship]

Really not worried.

 

About what?

[Mr Rumor]

Here is the link to the complete Reuters article:

 

http://www.reuters.com/article/2014/08/31/us-norwegiancruise-prestigecruises-idUSKBN0GV0T720140831

[dabear]

Interesting, it's one way for NCL to get into the luxury market similiar toCarnival and RCCL with multiple brands. NCL is creative and has tried to get into the high end with it's luxury suites area on it's newer cruise ships. If the deal closes, hopefully they will not tinker with the RSSC product, but will provide more capital for improvements.

[Winner]

NCL might bring aboard better coffee!

[Responder]

NCL might bring aboard better coffee!

 

And maybe some lower prices..;)

[xrvlcruiser]

Thanks Rich

[TedC]

And maybe some lower prices..;)

 

Sure hope they will BUT don't hold your breath!

[Travelcat2]

Interesting, it's one way for NCL to get into the luxury market similiar toCarnival and RCCL with multiple brands. NCL is creative and has tried to get into the high end with it's luxury suites area on it's newer cruise ships. If the deal closes, hopefully they will not tinker with the RSSC product, but will provide more capital for improvements.

 

Interesting take on the situation. From what I have seen, Apollo has put oodles and oodles of capital into both Regent and Oceania which is why they are in excellent shape (meaning they are running full ships, the ships are in great condition and they have built 2 new Oceania ships and are in the process of building a Regent ship).

 

I've been involved with very large mergers in the past (from a Human Resources perspective) and have no doubt that Regent and Oceania will still be headed by the same CEO and probably President and other essential staff. NCL needs to learn from PCH -- not the other way around. Even with the bloody included excursions, hopefully Regent will stay exactly the way it is.

 

I understand that Regent and Oceania are unable to say anything at the moment. If this goes through, there will be public announcements, etc. As I said in an earlier post, I am not worried. Just as when Apollo purchased Regent, things improved and I believe they will continue to do so.

 

In any event, things will unlikely change in the foreseeable future so get used to the coffee and prices.

[HanaleiSailor]

Aloha All,

 

If this merger goes through it is probably a good deal for both Prestige and NCL, but I cannot see how it will be a great deal for Regent passengers. The bean counters will necessarily be looking for economies of scale, so I would not be surprised at all to find changes in the Regent brand, particularly when it comes to purchasing food and beverage items, supplies and other items for the ships.

 

We have seen large corporations buy up a fair number of smaller Hawaii-based tourism-related businesses, and in no case do I remember the large corporations being better for either customers or local vendors.

 

I hope that I am wrong because we like Regent, have sailed twice, and are sailing again at the end of October this year. If the deal goes through, I will have to think very hard before booking another voyage on board. We might look into one of the smaller companies for 2015.

 

Aloha from Hanalei,

 

Mark

[WesW]

Hope Mark Conroy (founder, former President of Regent Seven Seas) via stock options in Apollo benefits greatly from this possible acquisition.

[jhp]

Aloha All,

 

 

 

We have seen large corporations buy up a fair number of smaller Hawaii-based tourism-related businesses, and in no case do I remember the large corporations being better for either customers or local vendors.

 

I hope that I am wrong because we like Regent, have sailed twice, and are sailing again at the end of October this year. If the deal goes through, I will have to think very hard before booking another voyage on board. We might look into one of the smaller companies for 2015.

 

Aloha from Hanalei,

 

Mark

 

 

Mark, I appreciate your comments. But, I don't know what one of the "smaller companies" you would look into, except for Silversea, which to my knowledge is the only one not already swallowed up by one of the giants. Of course, that line is still on a par with Regent, and Seabourn, Crystal, and some others that are already a part of larger corporate structures.

[HanaleiSailor]

Aloha JHP,

 

We have considered in the past the smaller ships of Windstar. This, I believe, is another comapany which is not operated by one of the big three or four cruise companies.

 

Aloha from Hanalei,

 

Mark

[Responder]

In addition, I have always found these types of mergers/acquisitions/buyouts, to eliminate what little competition we might have left.

[jongbj]

Although limited to the pharmaceutical industry, my experience with mergers/acquisitions/buyouts, having experienced them first hand, is that a merger/acquisition/buyout never has positive effect for the buyee.

It always turn out that the buyee will have to cough up the money the buyer paid, either through cut-back, staff-reductions, efficiency programs, closures, etc. etc. As long as the buyer gets compensated for the money they paid.

 

The only exception is when the buyee is in trouble and cannot survive without being taken over.

 

As Regent is financially strong, with good figures, this merger/acquisition/buyout or whatever they will call it, will certainly have a negative effect.

[hondorner]

Aloha JHP,

 

We have considered in the past the smaller ships of Windstar. This, I believe, is another comapany which is not operated by one of the big three or four cruise companies.

 

Aloha from Hanalei,

 

Mark

Correct in that it's not currently owned by a big cruie company. Windstar was purchased by HAL in 1987 (50%) and 1988. When HAL was purchased by Carnival, Windstar was part of the deal. Windstar was subsequently purchased by Ambassadors, which went bankrupt a few years ago. As part of the bankruptcy settlement, Windstar was purchased by Xanterra Resorts, itself a pretty big company, in 2011. So, while not one of the big cruise conglomerates, it's owned by a big company that really isn't familiar with running a cruise line. I'm not sure which would be worse, unless Xanterra is doing exactly what others are hoping if the rumored NCL deal goes through and keeps "hands off" a successful product.

[Travelcat2]

If you want a smaller ship that is privately owned, try Silversea. The onboard experience is similar to Regent...... however, be forewarned that they have suddenly stopped taking care of their ships -- no significant upgrade in 3-4 years on some ships. All kind of rumors about Silversea -- none of them positive. I'm not pleased about the this as Silversea has been a good alternative to Regent when they offer itineraries that Regent no longer has.

 

Not buying into doom and gloom predictions. Apollo isn't even a cruise ship company and look what they have done with Oceania and Regent. Many of the same officers and crew onboard, etc. They did merge some of the functions in the home office that resulted in lost jobs. The same happened when Seabourn and HAL's offices merged a couple of years ago. As I posted earlier, Apollo has poured money into Oceania and Regent ships. I do wonder, however, if the change in refurbishing the Navigator has to do with what is going on. She could be a fatality -- not because she isn't a beautiful ship but I would guess that they have put more money into the Navigator than the other two ships combined trying to fix problems that may not be fixable.

 

While I would not sail on NCL, I wouldn't sail on Carnival either but look at how successful the ships they own have been. I'm taking a wait and see attitude. Suspect that there will be some news soon since the media has picked up on the story. I do wonder how the media gets a hold of these stories when the stockholders are not permitted to discuss it.

Edited September 1, 2014 by Travelcat2

[dabear]

While I am concerned with economy of scale cutbacks, it seems most private equity companies will invest additional capital to improve their assets but then they sell out . Time will tell.

[computerworks]

NCL needs to learn from PCH -- not the other way around.

 

I could make a case for the opposite. Norwegian could teach them plenty about back office systems and technology.

 

Reality though, is that nothing should change on the front end for Regent or O.

[HanaleiSailor]

Aloha All,

 

Apologies if my previous message seemed to be doom and gloom; I did not intend it to be such. I like Regent and certainly hope that if there is a buyout that the brand will remain as good as it is, or perhaps even improve in some ways. I do, however, think it naive to believe that there will not be any changes to the Prestige holdings after the sale. We have seen far too many mergers and acquisitions in the Hawaii Tourism and Hospitality business to believe that all will remain exactly as it is today, before the merger.

 

I don't closely follow, nor do I have any great interest in the cruise industry, but one other thought that occurs to me is this: If this buyout is completed, will it make sense for NCL to operate three totally separate brands: NCL, Oceania and Regent.

 

It would seem to me that there would be a great deal of replication of both labor and purchasing operations if this were to be the case. Does anyone think that they might merge two of the brands?

 

Just my two cents.

 

Aloha,

 

Mark

[Travelcat2]

If FDR remains the head of Regent and Oceania, they will not merge. He has repeatedly stated this. There are very few similarities between the two cruise lines and the ships are completely different in terms of stateroom/suite size, target passengers, etc. I agree that NCL would want three brands which adding Oceania and Regent would do.

 

In an earlier post I thought that there could be some reduction in staff. I've had a chance to think it through a bit more and do not think this will be the case. Seabourn and HAL were standalone products until they merged offices in 2012. Regent and Oceania had separate offices until approximately the same year. Since the merger of offices and personnel have already taken place, it is very possible that it will remain the same without a change in personnel. While not an impossibility, it is were to happen it would probably be several years down the road.

[debijaynes]

What a bad news day!

HAL is now off our list--more like a Carnival ship everyday and I've never been on one--but sure have watched the people get off in different and it's hard to tell the difference. On our last HAL cruise we ate in the specialty restaurant every night to avoid the ....well I won't say what we avoided as that may be off subject.

If NCL buys Regent, I'm afraid the same may be in the works. Dumbing down RSSC so to speak.