Royal Caribbean Group says it has entered into a definitive agreement to sell its Azamara brand to Sycamore Partners, a private equity firm specializing in consumer, retail and distribution investments, in an all-cash carve-out transaction for $201 million, subject to certain adjustments and closing conditions.
Sycamore Partners will acquire the entire Azamara brand, including its three-ship fleet and associated intellectual property. The transaction is subject to customary conditions and is expected to close in the first quarter of 2021.
Royal Caribbean Group noted the transaction allows it to focus on expanding its Royal Caribbean International, Celebrity Cruises and Silversea brands.
Richard D. Fain, chairman and chief executive officer of Royal Caribbean Group, said: “Our strategy has evolved into placing more of our resources behind three global brands, Royal Caribbean International, Celebrity Cruises and Silversea, and working to grow them as we emerge from this unprecedented period.”
Fain continued: “Even so, Azamara remains a strong brand with its own tremendous potential for growth, and Sycamore’s track record demonstrates that they will be good stewards of what the Azamara team has built over the past 13 years.”
Stefan Kaluzny, Managing Director of Sycamore Partners, said of the agreement: “We are pleased that Royal Caribbean Group has entrusted Sycamore to support Azamara in its next phase of growth.”
And he added: “We are excited to partner with the Azamara team and build on their many years of success serving the brand’s loyal customers. We believe Azamara will remain a top choice for discerning travelers as the cruising industry recovers over time.”
Azamara’s value proposition and operations will remain consistent under the new arrangement, and Royal Caribbean Group will work in close collaboration on a seamless transition for Azamara employees, customers and other stakeholders. In conjunction with the transaction, Azamara Chief Operating Officer Carol Cabezas has been appointed President of the brand.
The transaction will result in a one-time, non-cash impairment charge of approximately $170 million. The sale of Azamara is not expected to have a material impact on Royal Caribbean Group’s future financial results.
Perella Weinberg Partners LP served as financial advisor to Royal Caribbean Group and?Freshfields Bruckhaus Deringer LLP?provided legal counsel. Kirkland & Ellis LLP provided legal advice to Sycamore Partners.