Norwegian Raises $2 Billion; Over 1 Year of Cash If Needed

Norwegian Epic

Norwegian Cruise Line Holdings today announced it successfully secured over $2 billion of additional liquidity in response to impacts of the COVID-19 global pandemic on the company.

The company announced last week it expected a cash burn of $100 to $150 million per month with most of its fleet in cold lay up, giving the company over a year of cash on hand for a worst-case zero-revenue scenario. 

Yesterday, the company announced the launch of a series of capital markets transactions, led by Goldman Sachs, to raise approximately $2 billion. The transaction has since been upsized to gross proceeds of $2.225 billion ($2.4 billion if the underwriters exercise their full overallotment options) due to significant oversubscription and demand across all three offerings.

The transactions consisted of (1) $400 million public offering of common equity, (2) $750 million exchangeable senior notes offering, (3) $675 million senior secured notes offering and (4) $400 million private investment from global consumer-focused private equity firm L Catterton.

In addition, a number of cost cutting measures range from layoffs to deferred loan payments on company ships.

Contingent on completion of the transactions, the company expects to have approximately $3.5 billion of liquidity.

This significantly strengthens the company’s financial position and liquidity runway and it now expects to be positioned to withstand well over 12 months of voyage suspensions in a potential downside scenario, according to a press release.

 

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