Royal Caribbean Scores USD 3 Bn Loan for Icon Duo

Miami-based cruise liner Royal Caribbean Cruises Ltd. has secured EUR 2.5 billion (USD 2.96 billion) to finance construction of its two new Icon-class LNG-powered cruise ships.

The loan is being provided by an international consortium led by German lender KfW IPEX-Bank. The banking syndicate also includes BNP Paribas, HSBC, Commerzbank, Santander, BBVA, Bayern/LB, DZ Bank, JPMorgan and SMBC.

The ships, which will be built at the Meyer Turku shipyard in Finland, will be able to carry over 5,500 passengers each, and are due to enter into service in 2022 and 2024, respectively. They will also introduce the use of fuel cell technology, the objective being a dramatic reduction of greenhouse gas emissions.

Royal Caribbean Cruises said that it will begin testing fuel cell technology on an existing Oasis-class ship in 2017, and will also run progressively larger fuel cell projects on new Quantum class vessels being built in the next several years.

“Cruise ships are booming, and the aim is to shape this trend for the lowest possible level of emissions for mankind and nature. We are pleased that our financing is helping to advance LNG propulsion,” Andreas Ufer, Member of the Management Board of KfW IPEX-Bank, said.

“This order will occupy our production until 2024. This not only affects our location in Turku, but also our whole supply network both in Finland and Germany on a significant scale. This combination of our successful distribution and the closely-tailored structured finance will sustainably secure jobs in Germany and Europe,” Jan Meyer, CEO of Meyer Turku, adds.

This is the largest syndicate financing package that KfW IPEX-Bank has ever structured and led on its own, which is contributing EUR 686 million to the deal.

The loans, granted separately for the ships, each have a term of 12 years from the respective ship delivery date.

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