Royal Caribbean Cruises Ltd. (RCL) has announced an agreement to acquire a stake in privately-owned Silversea Cruises to combine its long-term vision for the cruise industry.
RCL will acquire a 66.7% equity stake in Silversea Cruises based on an enterprise value of US$2 billion, and a purchase price of approximately US$1 billion. Silversea was in the news recently for breaking booking records.
Additionally, Manfredi Lefebvre, Silversea Cruises’ executive chairman, will qualify for an estimated contingent consideration of approximately 472,000 RCL shares, payable upon achievement of a certain 2019-2020 performance metrics.
“Silversea is a crown jewel, and the acknowledged leader in luxury and expedition cruising– two key markets that are poised for growth,” said Richard Fain, chairman and CEO of Royal Caribbean Cruises Ltd. “Uniting our two companies presents an extraordinary opportunity to expand vacation options for guests and create revenue in strategic growth areas.”
Fain added: “We are proud to welcome aboard Manfredi Lefebvre, a visionary leader whose high standards and history of innovation we deeply respect. Manfredi will remain as executive chairman of Silversea, continuing to lead its strategy long term.”
The strategic partnership will seek to drive long-term capacity growth in the burgeoning luxury and expedition markets at a much larger scale. It will also leverage the global footprint of the combined companies to generate demand and increase vacation and destination options for the guests of both companies.
Lefebvre commented on the two companies’ expansion plans, with the family heritage in mind: “This partnership will bolster the growth of this exceptional brand founded by my father. I have always kindred spirits with Richard and we share a vision of offering excellence and leadership to our guests. This new partnership gives Silversea the opportunity to accelerate the growth of the most successful luxury and expedition cruising brand in the world.”
The new agreement will not only accelerate both the cruise lines’ growth but also diversify RCL’s portfolio by increasing its number of offerings through Silversea’s premier luxury cruise offerings. The deal is expected to be completed later in the year, subject to customary closing conditions and regulatory approvals.