By Abigail W. Adams
Portland, Me., June 5 – Royal Caribbean Cruises Ltd. priced $1 billion of three-year convertible notes after the market close on Thursday at par with a coupon of 4.25% and an initial conversion premium of 25%, according to a company news release.
Pricing came at the rich end of tightened talk for a coupon of 4.25% to 4.5% and in line with talk for a fixed initial conversion premium of 25%, according to a market source.
Initial price talk was for a coupon of 5% to 5.5% and an initial conversion premium of 20% to 25%.
J.P. Morgan Securities LLC, BofA Securities Inc., Citigroup Global Markets Inc., Goldman Sachs & Co. LLC, Morgan Stanley & Co. LLC and SMBC Nikko Securities America, Inc. were bookrunners on the Rule 144A deal, which carries a greenshoe of $150 million.
The notes are non-callable.
The convertibles will be settled in cash, shares or a combination of both at the company’s option.
Concurrently, the company priced a $1 billion offering of three-year senior notes at par to yield 9 1/8%. Initial price talk for the senior notes was for a yield in the high 9% to 10% area.
Proceeds will be used for general corporate purposes, which may include the repayment of debt.
Royal Caribbean is a Miami-based cruise ship operator.
| Issuer: | Royal Caribbean Cruises Ltd.
|
| Securities: | Convertible senior notes
|
| Amount: | $1 billion
|
| Greenshoe: | $150 million
|
| Maturity: | June 15, 2023
|
| Bookrunners: | J.P. Morgan Securities LLC, BofA Securities Inc., Citigroup Global Markets Inc., Goldman Sachs & Co. LLC, Morgan Stanley & Co. LLC and SMBC Nikko Securities America, Inc.
|
| Co-managers: | BBVA Securities Inc., BNP Paribas Securities Corp., HSBC Securities (USA) Inc., Mizuho Securities USA LLC, Skandinaviska Enskilda Banken AB and SunTrust Robinson Humphrey, Inc.
|
| Coupon: | 4.25%
|
| Price: | Par
|
| Yield: | 4.25%
|
| Conversion premium: | 25%
|
| Conversion price: | $72.11
|
| Conversion rate: | 13.8672
|
| Call options: | Non-callable
|
| Put options: | None
|
| Pricing date: | June 4
|
| Settlement date: | June 9
|
| Distribution: | Rule 144A
|
| Talk: | Revised talk for a coupon of 4.25% to 4.5% and fixed initial conversion premium of 25%; initial talk for coupon of 5% to 5.5% and initial conversion premium of 20% to 25%
|
| Stock symbol: | NYSE: RCL
|
| Stock price: | $57.69 at market close June 4
|
| Market capitalization: | $12.08 billion
|
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