Royal Caribbean Line (RCL) has acquired a stake in privately-owned Silversea Cruises.
Under the agreement, Royal Caribbean will acquire a 66.7 per cent equity stake in Silversea Cruises based on an enterprise value of approximately US$2 billion.
The purchase price of the equity being acquired is approximately US$1 billion.
RCL plans to finance the purchase through debt.
Travel Weekly spoke with Silversea executive chairman Manfredi Lefebvre D’Ovidio and CEO Roberto Martinoli to find out more.
“The partnership was prompted by the fact that we are in the presence of a very strong market in our segment of the industry and we are trying as much as possible to expand our brand presence,” Lefebvre said.
“It’s a partnership which gives us the financial strength to expand. It’s an opportunity to build more ships.”
“This is really exciting for us it’s a confirmation of what we’ve been doing so far,” added Martinoli.
“It’s great to see that a brand like Royal is investing in our brand and investing in our management team.”
“It has been a great journey. As you can imagine it has been a long negotiation. We’ve partnered with another great company and we see a very bright future.”
RCL CEO Richard D. Fain said in a statement, “Silversea is a crown jewel, and the acknowledged leader in luxury and expedition cruising, two key markets that are poised for growth.
“Uniting our two companies presents an extraordinary opportunity to expand vacation options for guests and create revenue in strategic growth areas.”
In addition, Lefebvre will qualify for an estimated contingent consideration of approximately 472,000 RCL shares, payable upon achievement of certain 2019-2020 performance metrics.
According to Silversea, the partnership will mean:
- Driving long-term capacity growth in the burgeoning luxury and expedition segments at a much larger scale than what Silversea would achieve independently;
- Diversifying Royal Caribbean’s portfolio and increasing its expedition offerings by adding a premiere ultra-luxury brand;
- Leveraging the global footprint of the combined companies to generate demand and increase vacation and destination options for the guests of both companies;
- Realizing significant synergies related to global market access, supply chain, purchasing power and other economies of scale.
The cruise line also confirmed Martinoli will continue in his role, working with the existing Silversea management team.