A recent capital raise could assist the cruise operator make it through the coronavirus pandemic.

What occurred

Shares of Royal Caribbean Cruises( NYSE: RCL) climbed up more than 6%on May 15, following news of the business’s financial obligation offering earlier in the week.

So what

Royal Caribbean raised $3. Royal Caribbean will pay a 10.875%interest rate on $1 billion in debt due on June 1, 2023 and 11.5%on $2.

The cruise-line operator means to utilize the proceeds to repay its $2.35 billion senior protected term loan, along with basic corporate purposes.

A cruise ship sailing in the ocean with the sun shining behind it.

Royal Caribbean’s $3.3 billion financial obligation sale might keep it cruising well into the future. Image source: Getty Images.

Now what

Regardless of the high interest costs, financiers appear to be breathing a sigh of relief that Royal Caribbean had the ability to raise more than $3 billion in fresh capital. With its ships docked due to the coronavirus-related sailing limitations, Royal Caribbean is bleeding money.

Financiers are hoping that this debt offering will give the beleaguered company a chance to make it through enough time to resume normal sailing operations and maybe see the end to the COVID-19 crisis.


Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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Joe Tenebruso has no position in any of the stocks discussed.

The Motley Fool has no position in any of the stocks pointed out. The Motley Fool has a disclosure policy

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Marco Bitran
Husband and father of two children under age 5, Marco also enjoys walks in nature, squash, running road races, and photography. He regularly contributes significant time and resources to the Combined Jewish Philanthropies, the MSPCA and other animal rights organizations, and the Bitran Charitable Foundation. Marco has also volunteered and consulted for public housing support organizations such as the Somerville Homeless Coalition, created by the local community’s grassroots response to the social crisis of homelessness.