SeaVenture Cruises' prospectus provides an interesting overview of the industry and insight into the considerations and obstacles facing a start-up operation as well as established cruise lines.

Market View

In its prospectus, Sea Venture Cruises states that the cruise ship business is competitive, and cyclical in that cruise lines complete for consumer disposable leisure time dollars with other vacation alternatives and that demand for such activities is directly influenced by national and local economic conditions.

The prospectus says that the company will be in direct competition with 26 different cruise lines, adding that while the number of people taking cruises in North America has increased, the market for cruises has been very price competitive during the past few years, primarily because of the introduction of a substantial number of berths into the market.

The prospectus also states, however, that while management is aware of reports that demand for cruise vacations of one week or longer has not kept pace with the increase in passenger capacity, it believes that the Sea Venture vessel's luxury features and exotic itinerary will enable the company to maintain prices at profitable levels.


The prospectus states that fixed costs are a major portion of a cruise line's operating expenses and cannot be reduced when competition causes reduction in rates or load factors.

In addition, the cost of fuel is singled out as one of the major expenses of operating a cruise ship. The prospectus states that future increases in the cost of fuel would significantly increase the cost of cruise ship operations.


The prospectus also identifies certain risks which it says are unique to the cruise industry. These include labor disturbances or strikes that could delay or cancel cruises; government regulations; and damage to the ship.

Delivery of Ships

According to the prospectus, Sea Venture Cruises, through its wholly-owned Panamanian subsidiary, has chartered, from affiliated corporations, two ships; the Sea Venture, being constructed in Piraeus, Greece, for delivery in February of 1989, and the Tropicana, which will be renovated in Greece for delivery in September (1988).

The capital to build the Sea Venture has been obtained from a Greek financial institution which has a preferred marine mortgage on the vessel of approximately $15 million.

The owner of the Sea Venture is required to make semi-annual mortgage payments of approximately $1,222,200.

The Tropicana was purchased in 1988 for $1.2 million, and a $5 million loan has been obtained from a British financial institution to renovate the vessel.

The British financial institution will hold a preferred marine mortgage on this vessel. The owner of the Tropicana is required to make semi-annual mortgage payments of approximately $555,556.

Anastasios Kyriakides is Chairman of the Board of Directors, Chief Executive Officer, Secretary and a Director of Sea Venture Cruises. He is also a principal owner of the corporations that own the two ships.

The financial institutions that hold and will hold mortgages on the two vessels are not identified.

Sea Venture Cruises will operate the two ships through its wholly-owned Panamanian subsidiary, Sea Venture Maritime, on charters of eight years each, with options to extend for three additional one-year periods.

Sea Venture Maritime will be responsible for operating the ships, including crewing, fuel, insurance, and hotel services, and will pay the owners charter fees at the rate of $15,000 (Sea Venture) and $9,000 (Tropicana), respectively, per day the first year, after which the rates will increase by six percent per year.

Plan of Operation

According to the prospectus, Sea Venture Cruises plans to deploy the Sea Venture on seven-day cruises in the French Polynesian islands from mid-October through May, and on Alaska cruises between Vancouver and Anchorage from June through mid-September.

In the Tahitian market, the company will compete with two vessels, the Windstar and the Exploration, both of which are essentially appealing to different market segments.

In Alaska, the company will compete with approximately 18 other ships.

The Tropicana will sail one-day cruises from Miami to the Bahamas competing against three other ships.

Sales and Marketing

According to the prospectus, Sea Venture Cruises will concentrate on those markets in the United States and Canada it believes holds the strongest potential for cruise passengers, primarily New York, Florida, Illinois, Ohio, Michigan and California.

For the Sea Venture, there will also be heavy emphasis on group travel.

The Tropicana will be marketed primarily within a 200-mile radius from Miami.

Marketing efforts for both ships will consist of brochures, media advertising, public relations, and direct mail. $700,000 have been allocated for marketing and advertising expenses for the first seven months.


Anastasios Kyriakides is Chairman of the Board of Directors, Chief Executive Officer, Secretary and a Director. He is also the founder of Regency Cruises in which he holds 6.4 percent of common stock.

Douglas MacGarvey is President, CEO, Treasurer and a Director. He was formerly Senior Vice President of Sales and Marketing for Regency Cruises. Prior to joining Regency he was with Cunard Line.

A. Douglas Hamilton is Vice President of Sales. He was most recently President of Tours of Distinction. Prior to that he was Director of Sales for Norwegian American Cruises and has held sales positions with Cunard Line.

Christian Schunack is Vice President of Hotel Operations. He was most recently Vice President of Hotel Operations for Windstar Sail Cruises.

The principal shareholders are Anastasios and Maria Kyriakides, Douglas MacGarvey and Douglas Hamilton.

Sea Venture Cruises presently employs 17 persons in executive, supervisory, clerical and administrative positions, but intends to hire additional staff, including sales, marketing and administrative personnel.


Through its IPO effective May 27, 1988, Sea Venture Cruises aims to raise a minimum of $4,500,000 or a maximum of $6,600,000 within a period of 90 days. Underwriting discounts and commissions equal 10 percent, providing net proceeds to the company of $4,050,000 or $5,940,000, which are intended for working capital and marketing expenses; to finance the Federal Maritime Commission's financial ability requirements; and to repay indebtedness to the executive officer and principal shareholder, and accrued salaries in the amount of $1,431,964.

Net capital for the first seven months of operations, after this offering is completed, is estimated at $2,637,501 or $4,464,501.

According to the prospectus, if the Tropicana or the offering is delayed, Kyriakides is prepared to fund the company until it generates revenues from operations or the offering is completed.

Sea Venture Cruises is estimating that during the first 12 months of operations, it will generate sufficient revenues at 80 percent and 40 percent load factors for the Sea Venture and the Tropicana respectively, to cover chartering and operating expenses.

The estimate is based on full fare passenger rates less airfare and other, unidentified promotional subsidies.

Profile Investments Corporation of Fort Lauderdale is the underwriter.