Radisson Diamond Announced

Radisson Hotels International, a subsidiary of the privately-held $6.2 billion Minneapolis-based Carlson Companies, has announced a joint cruise venture with Finland-based Diamond Cruise Ltd.

While details will only be revealed here on May 21, it is believed that Radisson will be responsible for sales and marketing as well as hotel operations for a 356-passenger Swath concept ship to be built at Rauma Yards, and to be operated and owned by Diamond.

According to sources in Finland, the twin hulled, catamaran-type ship, will be positioned at the very top end of the cruise market. Finnish sources quoted a prospectus obtained from Diamond Cruises as stating that at 50 percent capacity, the break-even point would be at a per diem of $550.

In invitations to a presentation distributed to the press here, Radisson stated that the “vessel will feature a revolutionary, futuristic design, never before utilized in a passenger ship. It will serve the most upscale segment of the market with lavish quality and services. Construction has commenced for a launch in 1992.”

Sources here said that while Radisson would market the ship, it had no financial obligations if sales would not materialize according to expectations, and that only Diamond Cruise had an outright financial stake in the venture.

Conflicting Signals

While Rauma confirmed that it would build the vessel, other Finnish sources, meanwhile, said that no such vessel was under construction there, contrary to a Radisson statement that said that construction had commenced. Sources also said that Diamond Cruise’s last effort to raise funds through a public offering which closed January 31, 1990, had not succeeded in raising the 143 million Finnish Mark ($35 million) which was its goal. Sources here said that financing had been obtained from Japanese sources.

Industry executives here were also skeptical as to the size and design of the vessel. It is too small to be economical, said one analyst who asked not to be identified. At Temple, Barker & Sloane, J. Duncan McDougall said that the vast majority of current upscale cruise customers are affluent and older used to traditional designs and that they are resistant to change.

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