Carnival Corporation (LON:CCL, NYSE:CUK) has launched a US$6bn recapitalisation amid coronavirus turmoil.
The cruise operator aims to raise US$1.25bn through a share sale and at the same time seeks to issue around US$4.75bn of debt securities.
Bank of America, Goldman Sachs and JP Morgan are arranging the round of funding. The underwriters will be eligible to purchase an additional US$187.5mln of shares, and, initial buyers of debt will be able to buy up to an extra US$262.5mln in aggregate.
It said the intended use of proceeds was simply “general corporate purposes”.
Earlier this month, Carnival flagged it would seek new financial supports to “preserve financial flexibility”.
At that time, it warned that the docking of its ships because of coronavirus will have a “material negative impact” on its finances.
Having earlier cancelled all its North American cruise lines for at least a month and moored its Princess Cruise lines for at least 60 days, amid a drop in global demand for holidays due to the spread of coronavirus, the company said it was cutting costs and looking to tie down more financing.
Carnival intends to issue US$3bn of ‘first priority’ senior secured notes, due for maturity in 2023, along with US$1.75bn of senior convertible notes also due in 2023.