Cunard has reached a long-term charter agreement to market and operate Sea Goddess I and Sea Goddess II. The Cunard takeover came in place of an expected move by Kloster Cruise. Under the terms of the agreement, Cunard has arranged financing to repay Wartsila $55 million - the outstanding construction/capital costs owed by Norske Cruise, the limited partnerships that own the Sea Goddess ships. Norske Cruise will retain 20 percent ownership, while Cunard has an option to buy at some point in the future.
According to reports, the new financing provides payback over 12 years - compared to the original eight-and-one-half - and gives the line more financial flexibility.
Cunard is said to have formed a new U.K. company called Cunard Sea Goddess.
Norske Cruise has suffered losses since start-up, in part, because the dollar skyrocketed to a record high shortly after it signed the contract with Wartsila. Subsequent high capital costs, and the terrorist-induced collapse of the 1986 Mediterranean season also contributed to the difficulties.
CIN understands that the line was doing well, in spite of these difficulties but lacked the financial strength to continue operations and meet its capital obligations at the same time.
The general consensus in the industry is that the Sea Goddess product is 'perfect' and has been extremely well introduced and implemented.
Both ships are now well booked for the fall and winter seasons, and are expected to turn an operating profit for 1986.
For the time being, business will proceed as usual in the United States, with reservations still being handled by Sea Goddess in Miami. It is expected, however, that the Miami-based office will be closed. No changes in itineraries, or in the ships' staffs and registry are expected.
As Cunard took over NAC's Vistafjord and Sagafjord, this recent takeover puts the company solidly in the top niche of the luxury market. And it is the stated intention of Cunard to preserve the Sea Goddess product and market position.