29th Jun 2020 10:36
(Alliance News) - Cruise operator Carnival PLC on Monday said it has priced its USD1.86 billion and EUR800 million first-priority senior secured term loan facility tranches.
Both tranches have a five-year maturity with the USD1.86 billion tranche being issued at a price equal to 96% of face value bearing interest at adjusted London interbank offered rate with a 1% floor plus 7.500% per annum.
The EUR800 million tranche, meanwhile will also be issue at a price equalling 96% of face value and will bear interest at a rate of Euro interbank offered rate with a 0% floor plus 7.500% per annum.
Both of the term loan facility's tranches are prepayale at Miami, Florida-headquartered Carnival's option at a price equalling face value as well as "a customary make-whole amount for the first year after closing" of the face value plus 2% for the second year after closing and at par after that.
Carnival explained that "The obligations under the term loan facility will be guaranteed by Carnival PLC and the same subsidiaries that currently guarantee, and will be secured on a first priority basis by the same collateral that currently secures, Carnival Corp's 11.500% first-priority senior secured notes due 2023."
The facility is expects to close June 30, subject to closing conditions and definitive documentation. Proceeds will go towards general corporate purposes, including repaying near-term debt maturities.
Shares in Carnival were down 2.7% at 941.80 pence in London on Monday morning.
In March, the cruise line operator voluntarily paused its global operations in response to the "unpredictable circumstances" evolving from the spread of Covid-19 virus. While the temporary cancellation of operations was initially meant to last until May 11, Carnival has extended the pause three times as a result of public health challenges associated with the Covid-19 pandemic.
On Monday last week, the company extended its operational pause in North America until the end of September.
By Anna Farley; [email protected]
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