Recent corporate acquisition and ship sale news suggest that the cruise industry is entering a period of growing dynamism after a number of years when weak earnings plagued it.
This morning's news that Genting Hong Kong, owner of Asia focused Star Cruises, has acquired Crystal Cruises, the Los Angeles based luxury market operator, from Nippon Yusen Kaisha (NYK) for $550 million, significantly raises the profile of Genting in the cruise industry.
It acquired Norwegian Cruise Line in 1999-2000, but over the years it has gradually reduced its stake: Norwegian is now a listed company and Genting's remaining stake cannot be seen as a strategic asset.
Genting has two 150,000 gross ton ships on order at Meyer Werft for Star Cruises, a move that reversed decline in the group's interest in cruising. Genting has also pledged to order a newbuilding for Crystal.
Norwegian's acquisition of Prestige gave it strong foothold on the premium market with Oceania Cruises and also on the luxury market with Regent Seven Seas Cruises. Norwegian Cruise Line is not, as yet, present in the Far East, but senior executives have indicated that this could be on the cards as new ships join the company's fleet.
To sum up, the acquisition of Prestige gave Norwegian group strong foothold in the market segments where it had no presence, while Norwegian Cruise Line's organic growth may soon bring to the Far East.
The picture is far less straightforward with Genting: Star Cruises is an Asia focused contemporary market brand, while Crystal Cruises has its focus on the top end of the US source market. The synergies are less clear here than in the case of Norwegian-Prestige.
Meanwhile, TUI AG's announcement on 02 March that its Hamburg based TUI Cruises joint venture with Royal Caribbean Cruises Ltd. (RCCL) has acquired the 69,130 gross ton Splendour of the Seas from RCCL marks a change in TUI Cruises' strategy. So far, it has operated ships solely under its own brand, but Splendour of the Seas will, after being renamed, join the fleet of TUI's UK based Thomson Cruises operation.
TUI has said that it wants to bring the TUI Cruises and Thomson Cruises operations closer to each other and that Thomson, which charters four of its five ships from third parties, could use owned tonnage in the future. The 1996 built Splendour of the Seas is a Vision class ship and given the fact that Thomson needs to move away from its mainly 1980s vintage tonnage, further transfers of these ships to the UK brand may well be on the cards. The fact that TUI Cruises owns the newly acquired vessel of Thomson Cruises brings this operation closer to the sphere of influence of RCCL.