Norwegian Cruise Line Holding, the listed parent company of Norwegian Cruise Lin e and NCL America, has announced the refinancing of certain of its secured credit facilities.
In addition, the Company has received commitments to refinance certain of its other secured credit facilities. No material incremental debt will result from these transactions. Once completed, the transactions mean that the company has replaced higher cost debt with lower cost options.
“The first transaction, totaling $1.3 billion, consists of a $675 million term loan and a $625 million non-amortizing revolving credit facility. This new facility matures in 2018 and refinanced existing credit facilities which had maturities beginning in 2015 and were secured by Norwegian Star, Spirit, Sun, Dawn, Pearl and Gem,” the company said in a statement.
The facility bears interest at LIBOR (London Inter-Bank Offered Rate) plus an applicable margin of between 2.25% and 1.50% based upon the company's leverage ratio.
In connection with this transaction, the company has issued a notice of redemption for the remaining $228 million outstanding of its $350 million 9.5% Senior Unsecured Notes due 2018 with a redemption date of June 28, 2013.
The second transaction, for which the Company has received commitments, will refinance facilities secured by Norwegian Jewel, Jade and Pride of America by amending the credit agreements to reduce the applicable margins and enhance certain terms and conditions. This transaction is subject to customary closing conditions and is expected to close in the second quarter of 2013.
"These transactions, coupled with our recent initial public offering and unsecured notes offering, reflect the optimization of our capital structure and positions the company for the future," said Kevin Sheehan, President and Chief Executive Officer of Norwegian Cruise Line. "We have now replaced all of our higher rate debt with facilities with more favorable rates and terms and enhanced our maturity profile to better match the increased cash flow generation that accompany our upcoming fleet additions."
