Azamara cruise line sold

[SteveH2508]

2 minutes ago, Bloodaxe said:

 

I bow to your knowledge if that is correct.

It's a SWAG but the timings and the secrecy works.

[nocl]

7 minutes ago, SteveH2508 said:

Er - RCG contracted to buy PP from Carnival (the sale was announced pre Azamara's sale but the buyer of PP was kept under wraps for a bit) - so RCG owned it and then sold it on to Sycamore as part of the overall deal - not hard to follow. Maybe Sycamore wanted it as part of a plan to expand Azamara (bearing in mind at the moment cruise lines and ships would be selling for knockdown prices).

That is not the way the press release was worded.

 

 

Sycamore Partners will acquire the entire Azamara brand, including its three-ship fleet and associated intellectual property. 

 

Since it was very clear the number of ships that was included it is unlikely.

[SteveH2508]

3 minutes ago, nocl said:

Considering that the 210 million was paid to RCL and Princess is a CCL line it is very unlikely

Sale of PP was announced before the sale of Azamara. The purchaser of PP was kept secret until after the Azamara sale was announced.

[nocl]

Just now, SteveH2508 said:

Sale of PP was announced before the sale of Azamara. The purchaser of PP was kept secret until after the Azamara sale was announced.

Actually the sale of PP was announced after the sale of Azamara was announced

[SteveH2508]

3 minutes ago, nocl said:

That is not the way the press release was worded.

 

 

Sycamore Partners will acquire the entire Azamara brand, including its three-ship fleet and associated intellectual property. 

 

Since it was very clear the number of ships that was included it is unlikely.

 

3 minutes ago, nocl said:

Actually the sale of PP was announced after the sale of Azamara was announced

The publication of the announcements may have been that way round, but Sycamore buying a ship within a couple of days of buying a cruise line - I rather think that things had gone on behind the scenes for some time before that. I am convinced that Pacific Princess was always part of the deal - whether within the $201 million or extra is not clear.

[nocl]

9 minutes ago, SteveH2508 said:

 

The publication of the announcements may have been that way round, but Sycamore buying a ship within a couple of days of buying a cruise line - I rather think that things had gone on behind the scenes for some time before that. I am convinced that Pacific Princess was always part of the deal - whether within the $201 million or extra is not clear.

If what you are saying is true than RCL would be in violation of US financial laws for not disclosing material information as part of the transaction.  The presence of a fourth ship is certainly large enough to be considered to be a material event.  As such I doubt RCL would have neglected to include that information which clearly would have an impact on the value received in the transaction.

 

More likely is that Sycamore negotiated both deals in parallel with both RCL and CCL with the Pacific Princess transaction being contingent upon completion of  the Azamara transaction.  That would also fit with the contract with Princess having the non-disclosure element. As well as the announcement of the sale of the Pacific a couple of days after the Azamara announcement.

Edited January 25, 2021 by nocl

[SteveH2508]

8 minutes ago, nocl said:

If what you are saying is true than RCL would be in violation of US financial laws for not disclosing material information as part of the transaction.  The presence of a fourth ship is certainly large enough to be considered to be a material event.  As such I doubt RCL would have neglected to include that information which clearly would have an impact on the value received in the transaction.

 

More likely is that Sycamore negotiated both deals in parallel with both RCL and CCL with the Pacific Princess transaction being contingent upon completion of  the Azamara transaction.  That would also fit with the contract with Princess having the non-disclosure element. As well as the announcement of the sale of the Pacific a couple of days after the Azamara announcement.

You may well be right - suffice to say - wherever or from whoever Sycamore bought PP it was always 'part of the package' in their minds. This indicates to me that growing the business is their plan rather than asset stripping. Let's see a few years down the line (if we ever get to sail again).

[rallydave]

13 minutes ago, nocl said:

If what you are saying is true than RCL would be in violation of US financial laws for not disclosing material information as part of the transaction.  The presence of a fourth ship is certainly large enough to be considered to be a material event.  As such I doubt RCL would have neglected to include that information which clearly would have an impact on the value received in the transaction.

 

More likely is that Sycamore negotiated both deals in parallel with both RCL and CCL with the Pacific Princess transaction being contingent upon completion of  the Azamara transaction.  That would also fit with the contract with Princess having the non-disclosure element.

Can’t find a 10k report regarding the sale and a guess is that the sale has not been signed as yet. The press release said an agreement in principal subject to conditions so no need as yet to notify fhe SEC. 

[nocl]

8 minutes ago, rallydave said:

Can’t find a 10k report regarding the sale and a guess is that the sale has not been signed as yet. The press release said an agreement in principal subject to conditions so no need as yet to notify fhe SEC. 

There is not a 10k, but there was an 8k filed with the SEC.  You can find it on edgar.  The filing included the press release clearly stating 3 ships.

[nocl]

17 minutes ago, SteveH2508 said:

You may well be right - suffice to say - wherever or from whoever Sycamore bought PP it was always 'part of the package' in their minds. This indicates to me that growing the business is their plan rather than asset stripping. Let's see a few years down the line (if we ever get to sail again).

I expect to follow the same path as Apollo did with NCLH.  Build the brand with the idea of taking it public via an IPO or SPAC sometime in the future.  The intent would be to create value such that they would receive multiples of their investment upon taking the brand public.  

 

The only real question is their intent of where they position the brand in terms of price, service, etc to accomplish the growth and increase in value  they need prior to an IPO.

 

Would not be surprised to see additional deals in the near future as part of their strategy. Maybe something involving Oceania would not surprise me.

[Tom47]

I think that Oceania is Az main competitor.  If Az really wants to compete, it would commission a new build.

[nocl]

22 minutes ago, Tom47 said:

I think that Oceania is Az main competitor.  If Az really wants to compete, it would commission a new build.

Depends upon how they position. 

 

They picked up their ships for about 190k per cabin.  A new build would cost them (as it did Oceania) about 5x that number (Oceania paid 960k per cabin for their 1200 passenger ships). 

 

I can see them picking up a couple more of the R class ships and building a very nice, very profitable  cruise line focused on appealing to those that like the small ships and the itineraries that one can have with them.  That does not require new builds.  Only a well positioned line, with good value, and service.

 

If a new build were to be part of the equation I would expect it to be announced just prior to an IPO.  Timed such that it could add to the wow factor, but not such where the costs impact the balance sheet prior to an IPO.

 

Now Apollo did go the new build route fairly soon after  it purchased Oceania, but the economics were a bit different.  They ended up selling to NCL.

 

Again would not be surprised if they got one or more of the R class ships from Oceania with the cruise industries current situation.

 

 

Edited January 26, 2021 by nocl

[rallydave]

7 minutes ago, nocl said:

I can see them picking up a couple more of the R class ships and building a very nice, very profitable  cruise line focused on appealing to those that like the small ships and the itineraries that one can have with them.  That does not require new builds.  Only a well positioned line, with good value, and service.

Well, there were only 8 total R ships with Oceania now owning 4, Azamara owning 3 plus Pacific Princess which may be owned by Sycamore Partners or Azamara so not sure wher these couple more R Ships will come from.

[nocl]

13 minutes ago, rallydave said:

Well, there were only 8 total R ships with Oceania now owning 4, Azamara owning 3 plus Pacific Princess which may be owned by Sycamore Partners or Azamara so not sure wher these couple more R Ships will come from.

Oceania, if they were to pick up any more.  Since Oceania has two new ships being built scheduled for 2022 and 2025 that go along with (similar in size and design) their last two new ships the Marina and Rivieria. They might be willing to part with 1 or 2 of their R class ships during these trying times for cruise lines. Since clearly it will be 2022 before cruising even starts to get back on a normal track. They could sell 1 and have the same fleet size post Covid as before.

[azdrydock]

1 hour ago, nocl said:

Oceania, if they were to pick up any more.  Since Oceania has two new ships being built scheduled for 2022 and 2025 that go along with (similar in size and design) their last two new ships the Marina and Rivieria. They might be willing to part with 1 or 2 of their R class ships during these trying times for cruise lines. Since clearly it will be 2022 before cruising even starts to get back on a normal track. They could sell 1 and have the same fleet size post Covid as before.

Doubt they would sell to a direct competitor. The current value of an R Ship is already approaching scrap value so it makes sense to salvage spare parts and scrap rather then sell. O currently uses them for world cruises and less traveled routes and they probably would continue in that role as the new ships come online.

 

Edited January 26, 2021 by azdrydock

[Host Jazzbeau]

All this talk about how old the 'R ships' are!  These are actually Renaissance's second-generation ships.  Seven of the first generation 'Renaissance class' (also 8 identical ships, that time numbered I through VIII) are still sailing even though they are 10 years older than the 'R ships.'  Noble Caledonia has built a very nice business around 3 of these ships (Renaissance VI through VIII), and it wouldn't surprise me if they buy Silver Galapagos (Renaissance III) to round out their fleet.  Breakthrough design, over-engineered, quality build – these ships [Renaissance class and R class] still have much life left in them, especially given the prohibitive cost of building small ships these days.

[avw]

5 hours ago, nocl said:

If what you are saying is true than RCL would be in violation of US financial laws for not disclosing material information as part of the transaction.  The presence of a fourth ship is certainly large enough to be considered to be a material event.  As such I doubt RCL would have neglected to include that information which clearly would have an impact on the value received in the transaction.

 

More likely is that Sycamore negotiated both deals in parallel with both RCL and CCL with the Pacific Princess transaction being contingent upon completion of  the Azamara transaction.  That would also fit with the contract with Princess having the non-disclosure element. As well as the announcement of the sale of the Pacific a couple of days after the Azamara announcement.

Agree with you, Nocl. These three statements from the various parties involved all point to two separate purchases by Sycamore (one for a cruise line with 3 ships and one for a single ship), with a plan to enter the cruise business with a total of 4 ships under the Azamara brand. The announcement from Carol Cabesas said " "Sycamore Partners has purchased the Pacific Princess, a former R-class ship comparable in size to our three sister ships". The announcement by Princess said "Princess Cruise today announced the sale of Pacific Princess to an undisclosed buyer". Managing Partner of Sycamore said "'The addition of this ship is an important milestone and reflects Sycamore Partners’ commitment to supporting Azamara in its next phase of growth."

[Grandma Cruising]

15 hours ago, JandMinToronto said:

The changes promise to be very exciting, and now with the "new" 4th ship coming even more to look forward to!  We currently have 7 Azamara voyages deposited over the next couple of years, and can't wait until we start travelling again.

 

Meanwhile I had earlier provided some feedback to AZ when solicited, and I sure hope they incorporate for the 4th ship renovation, as possible:

 

"

One piece of feedback that I was keen to provide to the survey, was to try and greatly improve the quality and speed of the internet on board.  I know the ships are a little bit older, and being on the high seas means that ships are beholden to satellite technology, but for working people it means a lot to have fully functioning internet.  By having internet that is more responsive with speed and security, I think you could improve your target market of working people, or business owners who need to be periodically online.   I was recently on an Expedia call in which Oceania and Regent were present. I think it was Regent that said they have internet access that would appeal to small business owners.  As a consultant myself, my ears immediately heard that and I thought that’s a very good point. 

 

I’m sorry I can’t remember if they are present in the suites I’ve booked, but having an actual internet Ethernet port rather than just relying on WiFI might actually help speed things up. This could be a perk that is available in suites for those of us who need the cable option for security reasons."

I have seen a Princess advert in which they say the Pacific Princess has “the best wifi at sea”. Probably just hype, but may reduce Azamara’s refurb costs.

[Host Jazzbeau]

12 hours ago, Grandma Cruising said:

I have seen a Princess advert in which they say the Pacific Princess has “the best wifi at sea”. Probably just hype, but may reduce Azamara’s refurb costs.

 

My understanding is that the weak link in all ship wifi service is the satellite link.  A ship with fewer than 700 passengers has much more bandwidth per passenger on that link, so Azamara should have an edge.

[asnaleah]

On 1/25/2021 at 10:26 AM, Grandma Cruising said:

It was a great cruise.

We were on that cruise too! Our first on Azamara. 

[Wheelhouse]

Sycamore is certainly very busy these days.

 

 https://www.cnbc.com/2021/01/26/department-store-retailer-belk-files-for-chapter-11-bankruptcy.html

[rallydave]

1 minute ago, Host Jazzbeau said:

 

My understanding is that the weak link in all ship wifi service is the satellite link.  A ship with fewer than 700 passengers has much more bandwidth per passenger on that link, so Azamara should have an edge.

The edge  would be true if the cruise line buys the same amount of bandwidth however satellite internet is sold by the amount of bandwidth the cruise line buys.   Assuming Azamara buys band width based on the size of their R ships and Carnival buys on the basis of their larger ships pacific princess would have much more bandwidth however once part of Azamara the bandwidth will go down to what Azamara buys for same size ships so the advantage is gone the same as the other ships in the Azamara fleet  

[azdrydock]

5 hours ago, asnaleah said:

We were on that cruise too! Our first on Azamara. 

Same here.

We were part of the Adventure Inn group. Lot's of controlled chaos that kept things interesting and one of the best overall cruise experiences we had.

Edited January 27, 2021 by azdrydock

[combine]

Edit...in the time it took me to work how to attach the link its been updated and Orlando is now Azamaras incoming Executive Chairman.

 

Shared link from a FB post. 

 

 

“The other interesting angle about the ‘new’ Azamara is what role, if any, Orlando Ashford might play. The former president of Holland America Line joined Sycamore Partners as a ‘strategic advisor’ in September last year.

Although Mr Ashford has a wide range of experience across many industries, including Coca-Cola, and sits on various boards, he spent six years at Holland America providing, as he states on LinkedIn, ‘unmatched guest experiences on board the fleet of 15 premium cruise ships’. Azamara declined to comment.”

 

https://shipmonk.co.uk/2021/01/26/will-the-new-azamara-buy-a-fifth-ship-and-what-role-if-any-will-orlando-ashford-play/amp/?__twitter_impression=true&fbclid=IwAR0VRCwaFEY1ptWphsXvGeC6PT3Lj1NoJSfupLwKopl_iY70lXu39j0q-aQ

 

 

Edited January 27, 2021 by combine

[Skicruiser55]

This makes the whole deal feel a lot better and more well planned not just a jumping in with no knowledge.  Looking forward to seeing good things happen.  While shiny and new is nice it’s the itineraries that AZ provides that draw us back.  Being able to sail into small ports like Seville and have 2 overnights is very appealing.  I can’t wait to see what itinerary AZ 4 puts out for 2022.