Carnival Nearly Doubles Loan Offering After Boosting Yield

Cruise line operator Carnival Corp. nearly doubled the size of its cross-border loan offering to $2.8 billion from $1.5 billion originally after it offered better interest payments to attract investors, people familiar with the matter said.

The offering now is split between $1.86 billion and 800 million euros, with the new senior secured loans being offered at 750 basis points above the base rate, up from 675-700 basis points previously. The notes come at a discount of 96% of face value. The yield on the 800 million euro portion now comes out to 850 basis points, up from about 800 basis points previously.

Carnival is seeking cash from investors on both sides of the Atlantic to shore up liquidity in the aftermath of the pandemic. While the company interest payment on the notes is now higher, it’s remains notably lower when compared with the 11.5% year Carnival offered in April, when it sold a $4 billion bond.

JPMorgan Chase & Co is leading the loan sale, alongside Goldman Sachs Group Inc. and a number of other banks. Investors have until Friday afternoon in Europe and 11 a.m. in New York to confirm their loan commitments.

Carnival shares rose about 2% in pre-market U.S. trading on Friday. While still down 69% for the year, the stock has gained 82% since Carnival completed its last bond sale.

©2020 Bloomberg L.P.

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