By Abigail W. Adams
Portland, Me., Oct. 14 – Royal Caribbean Cruises Ltd. priced $500 million of three-year convertible notes after the market close on Tuesday at par with a coupon of 2.875% and an initial conversion premium of 37.5%, according to a company news release.
Pricing came at the rich end of revised price talk for a coupon of 2.875% to 3.375% and through revised talk for an initial conversion premium of 30% to 35%, according to a market source.
Initial price talk was for a coupon of 3.375% to 3.875% and an initial conversion premium of 25% to 30%.
Morgan Stanley & Co. LLC (lead left) and BofA Securities Inc. were active bookrunners for the Rule 144A deal, which carries a greenshoe of $75 million.
The notes are non-callable.
They will be settled in cash, shares or a combination of both at the company’s option.
Concurrently with the convertible notes offering, Royal Caribbean priced a secondary offering of 8,333,333 shares at a price of $60 per share. The secondary offering carries a greenshoe of 1.25 million shares.
Proceeds will be used to repay the company’s 2.65% senior notes due 2020 and for general corporate purposes.
Royal Caribbean is a Miami-based cruise line operator.
| Issuer: | Royal Caribbean Cruises Ltd.
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| Securities: | Convertible senior notes
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| Amount: | $500 million
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| Greenshoe: | $75 million
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| Maturity: | Nov. 15, 2023
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| Bookrunners: | Morgan Stanley & Co. LLC (lead left) and BofA Securities Inc.
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| Coupon: | 2.875%
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| Price: | Par
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| Yield: | 2.875%
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| Conversion premium: | 37.5%
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| Conversion price: | $82.50
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| Conversion rate: | 12.1212
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| Call options: | None
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| Pricing date: | Oct. 13
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| Settlement date: | Oct. 16
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| Distribution: | Rule 144A
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| Talk: | Revised price talk for a coupon of 2.875% to 3.375% and an initial conversion premium of 30% to 35%; initial talk for a coupon of 3.375% to 3.875% and an initial conversion premium of 25% to 30%
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| Stock symbol: | NYSE: RCL
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| Stock price: | $60 in concurrent offering
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| Market capitalization: | $13.01 billion
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