Azamara cruise line sold

[richard_london]

Does anybody know how integrated Azamara is with the rest of RCCL's brands?  I've only mainly used Carnival brands and I know they share a lot of systems and sales teams, etc.  It's clear Sycamore have bought the three ships, but what about all the back office stuff, IT, supply chain, finance, marketing, HR department, stevedoring, etc etc.  If all that was part of the wider RCCL group and "shared" by all the brands, will RCCL carve out a portion of that for Sycamore?  If not, replicating that would be quite hard (I imagine) for a company with no track record as suggested in previous posts.  So it would be interesting to know what the sale encompasses.  I've always liked the look of their ships, especially since they were repainted.  Hope it is not a bad sign for the future.

[HalifaxYorksCruiser]

21 minutes ago, rallydave said:

Expect prices to increase once the economies of size being a part of the Royal Caribbean Group starts affecting all of the food, drink, fuel, etc. that will now be purchased in a much smaller scale and thus increased costs..

And will they be able to get airlines to give competitive flight prices

[Mackdogmolly]

“The transaction is subject to customary conditions “ is the bit that scares me

Betsey

[mare s.]

Oh dear!   This does not bode well.

 

[Cruiser6270]

Very disappointing and concerning development for Azamara, despite the upbeat spin they're trying to put on this. 

[the mice]

Trade press has statements from the Sycamore Partners side:

https://www.cruiseindustrynews.com/cruise-news/24220-royal-caribbean-to-sell-azamara-brand-to-sycamore-partners.html

[GlobalMethod]

1 hour ago, Riocca said:

wondering what a Private Equity company would want other than to asset strip

Hopefully, what the want is to buy cheap during this cruising chaos and then sell for a large profit later, as they have done with some of their other businesses ... they definitely bought at the bottom and arranged to keep key players.

[ikelmay]

Not too surprised at the news, I've felt that Azamara was becoming a bit of an orphan within the group given the SS purchase. Selling to a private equity firm that specialises in retail?  Good luck with that one.

 

The only consolation is that the bare-bones operation with 3 vessels at around 20 years of life doesn't give Sycamore much to asset-strip.  I'm at a loss to see where economies and savings can be made without impacting the guest experience - extracting a niche line from the RCCL infrastructure is only going to add cost, especially as RCCL have been busy over the last years pulling Azamara's back office functions into the parent group operations.

 

 

 

 

[partiamo]

As I read the announcement in Cruise Industry News,

 

Royal Caribbean Group today announced it has entered into a definitive agreement to sell its Azamara brand to Sycamore Partners, a private equity firm specializing in consumer, retail and distribution investments, in an all-cash carve-out transaction for $201 million,

 

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

 

So, 3 ships for $201 million equates to $67 million per ship.  These ships all date from 1999 to 2000, so not youngsters.  Ships like these headed for scrap probably are not worth more than $15 million.  So, it appears Sycamore is in this to improve the brand.  However, it appears they will need to set up a whole new back office.  If they hire the right people to run this line they could make a go of it.

 

As everyone says, we will see.

[GlobalMethod]

3 minutes ago, ikelmay said:

doesn't give Sycamore much to asset-strip

Agreed ... so the play here is to grow the brand into the next decade ... hopefully that will benefit those of us who have helped grow the brand ... we started with them when they were a new cruise line ... the fact that they are maintaining key players indicates it is not an asset strip type of investment ... more of a long term growth holding

[Lindy028]

Not unexpected, but so sad. I know we’ll have to wait to see how things go, but every time things change on Azamara we end up paying more and the poor crew end up doing more work and working longer hours. RCI. have never been totally committed to Azamara, so in that sense maybe things will improve. The thing is, I know so many cruisers who have always preferred the bigger ships, who are now saying they think they’ll only choose smaller ships going forward, obviously as a result of the Pandemic. Maybe RCI have missed a trick! 
This must be a huge amount of stress for the crew on top of the worries of the Pandemic! The World as we know it, may never be the same!

[Grahambythesea]

Awful news that RCG are selling Azamara. We generally cruise either Azamara or Celebrity and our Club points count on both. That will be the first “perk” to go and then we can watch the money men whittle away at the costs - Azamazing evenings, included drinks, port shuttles, staff ratios. 
A lot of people predicted RCG would loose interest when they bought Silverseas, probably hurried on by the year’s no sale orders.

What a shame!

[bdrcole]

Ironically today I received a brochure in the mail from Azamara titled - Your Dream Exploration awaits.

[GlobalMethod]

2 minutes ago, Lindy028 said:

This must be a huge amount of stress for the crew on top of the worries of the Pandemic! The World as we know it, may never be the same!

We were known on all 3 ships by about 25 crew on the 1st day of a voyage ... these crews were just the best and I hope many stick with them ... they buyers appear to be smart enough to realize that when you have loyal customers you don't change anything unless it will make it better for your customers!

[cborzill]

In my opinion, Azamara was never given a chance.  Royal Caribbean initially intended to fold those ships into the Celebrity brand, then decided to create a new brand, mainly to compete with Oceania, calling it Azamara.  But Royal Caribbean never made the necessary investments, such as ordering new ships, like Oceania did.  Initially, Azamara copied the Oceania product, then they switched strategy and decided to distinguish itself by emphasizing land programs and late port stays.  That is fine, but they never did anything to improve the actual cruising experience.  I hope they do better with Silversea, which already has new ships coming on line.

 

[rallydave]

A positive thought.  Getting rid of the horrible RCI computer system and the inept programmers at RCI.  Perhaps soon people will actually be able to opt in or out for emails without constant failures.

[Trend]

Sad to read when I got the email. Investment companies are just that investors with money not quality or feelings as a bottom line.

Not surprised in the COVID climate this happened.

Time will tell but I see dark clouds on the horizon.

[Host Jazzbeau]

6 minutes ago, rallydave said:

A positive thought.  Getting rid of the horrible RCI computer system and the inept programmers at RCI.  Perhaps soon people will actually be able to opt in or out for emails without constant failures.

 

The first thing they have to do is separate the two computer systems – or Azamara won't have anything at all.  And given the way it operates, my suspicion is that the whole RCG system is written in COBOL.  So Baby Boomers will be in demand again, because they're the only ones who still remember it!

[sunrise@sea]

Not surprising, this line was the best moderate lines around for a long time.  Ships not too big, not too small, great service and itineraries for the right price.  Obviously RCL want to maximize revenue with large low end and some high end cruise lines. 

Hate to be negative but the new owners can only make Azamara worse.  Being a part of a large conglomerate gave not only benefits to us the customers, but also the leverage in buying the food, supplies, food, along with the maintenance subcontractors, the employment services, harbor administration around the world.

Let's just hope the new boys honor the cruises we already have booked.

 

So what comes next, the sale of Celebrity too?

Edited January 19, 2021 by sunrise@sea

[gnld]

We have 2 Azamara cruises coming up in the next 12 months, paid for with FCC and free nights (we became Discoverer+ after our last  AZ cruise). I expect FCC to be honored as that represents $$ paid to Azamara for cancelled Mar/Apr cruises. Discoverer+ benefit included cruises on Celebrity, and I hope in the near term that will be honored, too. We'll have to see how things play out as this year goes along. Long term, I'm not overly confident regarding Azamara's survival, vis-a-vis being sold to a Private Equity firm.

[annandme]

I just applied to RCL for my Azamara shareholder credit for my upcoming cruise and was approved.  Apply soon if you want yours too.

[Tom47]

Like others, we will wait and see.  The possibility of new ships with current staff is hopeful.  New ships could mean decent size bathrooms/showers.  Celebrity and Azamara were our 2 favorite cruise lines.  We don't have any cruises booked with Az presently.  I also rec'd the Az email.  We will miss the shared loyalty with Celebrity/RCI.

[chromered7]

4 hours ago, uktog said:

OK lets look at it another way.

What the partners have seen is the strength of the onboard experience, the skills of the onboard management teams and the loyal customer base.  They recognise the brand was being held back by the ships and the level of investment by the parent company

So buy and also build new ships for them = a longer term investment in the equity portfolio

I do

[TeaBag]

41 minutes ago, annandme said:

I just applied to RCL for my Azamara shareholder credit for my upcoming cruise and was approved.  Apply soon if you want yours too.

Are you sure this would be honoured by the new owners?  We are actually wondering who is going to pay back our deposit once RCG is not involved, if we cancel, seeing changes we don't like.  Our cruise is not till May 2022.

[tomworldwidewaftage]

Baron Rothschild said "to buy when there is blood in the streets"