Viking Cruises has raised $975 million through a private placement of $675 million in 5.000 percent senior secured notes due 2028 and an additional 275 million at 5.875 percent due in 2027.
Viking will have grown its cruise brand from a single 930-guest ship in 2015 to a fleet of ten ships with 9,300 berths by 2024, making it the largest cruise line operating ships under 1,000 passengers, according to the 2018-2019 Cruise Industry News Annual Report. It also gives it dominance of the luxury market by capacity and market share.
Viking said it will use the proceeds of the note offering to repay all outstanding loans used to finance the Viking Star and Viking Sky, and to repurchase the Viking Sea, which the cruise line has operated on a sale-leaseback agreement.
Moody’s gave the new $675 million senior secured notes a Ba2 rating and S&P gave it a BB rating.
Both Moody’s and S&P cited a positive growth outlook for the brand that could enable it to reduce its debt to EBITDA by the end of 2018.
As of December 2017, Viking operated a fleet of 62 river vessels and four ocean-going cruise ships. TPG Capital and the Canada Pension Plan Investment Board hold a combined 20 percent interest in the company.
Net cruise revenues were estimated at about $1 billion in 2017.
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