Behind Royal Caribbean’s Lifeline, a Shrewd Bond Maneuver
- Unique structure let cruise company flout secured debt limits
- Deal may be copied by other fallen angels facing restrictions
Passengers stand on board the Royal Caribbean Cruises Navigator Of The Seas cruise ship at the Port of Miami on March 9,.
Photographer: Jayme Gershen/BloombergThis article is for subscribers only.
Royal Caribbean Cruises Ltd. was in a quandary.
The company needed to raise money while its ships were docked amid the Covid-19 pandemic, and the bond market was open if Royal Caribbean was willing to mortgage ships as collateral. Similar deals had worked for rivals like Viking Cruises and Norwegian Cruise Line Holdings Ltd.