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Will HAL be next?


KirkNC
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Thanks. I'm not surprised.

 

CCL has slashed capacity by 16(?) ships. RCL is cutting redundant brands. Everyone is cutting costs and raising cash.

 

IMHO, HAL is on the chopping block if too few HAL ships are left. Everything depends on the pace of vaccination, and the ability of North America to bring covid under control.

 

Fingers crossed! 😬

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8 minutes ago, HappyInVan said:

 

IMHO, HAL is on the chopping block if too few HAL ships are left. Everything depends on the pace of vaccination, and the ability of North America to bring covid under control.

 

Fingers crossed! 😬

If that’s the case, we are in trouble!

Edited by KirkNC
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I got the email this morning as a past Azamara cruiser.

 

I think there is a big leap between a venture capital company acquiring three unique but identical smaller capacity ships and a clearly aligned philosophy and acquiring a brand like HAL with a current fleet of 10 ships (soon to be 11) in four different "classes" and with somewhat of an identity crisis.

 

This investor doesn't seem to have a lot of experience with cruise lines that I could find at a quick look. It will be interesting to see what happens. I've always thought of Azamara as a bit of a "sleeper" brand, perhaps a bit like what HAL might have been in decades past, with a quiet emphasis on destination and itinerary.

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Some may be aware that RCI is selling it's upscale small ship Azamara brand to Sycamore Partners which is a pretty well known private equity firm.  The deal will reportably  give RCI about $201 million in cash although that amount may not be the whole story.  What does this mean?  It does give RCI some more cash and would relieve it of the monthly cash drain related to Azamara.  I think that Azamara has always been a lost child with RCI which has not done a lot to improve/expand the brand.  Sycamore might be expected to make some improvements with the goal of increasing the value of the line and then eventually resell it for a profit.   For those not familiar with Azamara the small ship line has been a pretty decent option for HAL lovers who continue to seek out smaller ships or a similar size as our beloved Prinsendam.  

 

Hank

 

 

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22 minutes ago, cruisemom42 said:

I got the email this morning as a past Azamara cruiser.

 

I think there is a big leap between a venture capital company acquiring three unique but identical smaller capacity ships and a clearly aligned philosophy and acquiring a brand like HAL with a current fleet of 10 ships (soon to be 11) in four different "classes" and with somewhat of an identity crisis.

 

This investor doesn't seem to have a lot of experience with cruise lines that I could find at a quick look. It will be interesting to see what happens. I've always thought of Azamara as a bit of a "sleeper" brand, perhaps a bit like what HAL might have been in decades past, with a quiet emphasis on destination and itinerary.

LOL, so HAL’s disfunction may save it 😎

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I hope not - we literally just got off the phone with our advisor to purchase 100 share shares of CCL for the shareholder benefit for our upcoming HAL cruise.  😊

 

I would think Seabourn would be more likely as others have mentioned.

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16 minutes ago, rodndonna said:

I hope not - we literally just got off the phone with our advisor to purchase 100 share shares of CCL for the shareholder benefit for our upcoming HAL cruise.  😊

 

I would think Seabourn would be more likely as others have mentioned.

I didn't know there was a shareholder discount.  What is it?  I might invest.

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Carnival Corp's closest analogue to Azamara may be Cunard imho. Definitely in number of ships. Segment-wise, Azamara seems to be in the same tier as Oceania and maybe Viking. Carnival doesn't really have a cruise line between "premium mass-market" like HAL and "luxury" like Seabourn, unless you consider Cunard as such (I don't). 

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3 minutes ago, ScottC4746 said:

I didn't know there was a shareholder discount.  What is it?  I might invest.

You get OBC if you hold 100 shares of CCL. The amount of OBC depends length of cruise- $100 for a 7 day cruise.

It applies to any of the brands under Carnival-so includes HAL, Costa , Seaborn, Cunard etc...

 

Worth it if you are a regular cruiser. 

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I suspect the decision will be based on profitability, current cash drain, and any future Corporate marketing direction.  

 

Unless you are privy to that data my guess is that anything can happen.   We are already long past the date by which it was expected that the industry would restart.  Plus, the actual industry restart date in volume appears to be be late Q4 or Q122.

 

Perhaps when the 2020 corporate financials are released and the usual announcements made we will have some indication.  Should be any day now.  My understanding is Carnival closed on Nov 30, RCI on Dec 31.

Edited by iancal
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22 minutes ago, rodndonna said:

You get OBC if you hold 100 shares of CCL. The amount of OBC depends length of cruise- $100 for a 7 day cruise.

It applies to any of the brands under Carnival-so includes HAL, Costa , Seaborn, Cunard etc...

28 minutes ago, ScottC4746 said:

I didn't know there was a shareholder discount.  What is it?  I might invest.

Worth it if you are a regular cruiser. 

$50 OBC for cruises under 7 days. $100 OBC for cruises 7-14 days. $250 OBC for cruises longer than 14 days. And this is for all lines owned by Carnival Corporation.

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We sailed Azamara in 2008, before they became all inclusive.  Pricing was great, as it was a one year anniversary sale promo, and they were trying to compete with Oceania.

 

At that time, service, crew, food was phenomenal.   

 

Carol

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This is bad news for Azamara. A private equity firm's entire premise is to buy and strip down to bare minimum. This one in particular has a pretty storied history of it.

 

I can't see Carnival Corp spinning off Seabourn. Of all Carnival brands, Cunard and P&O are likely the most at risk of being sold off for for equity scrap. 

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I think RCCL sold off based on revenue generated and overall size and I think that would be what CCL would do if they were to sell out a line.  HAL would not be the front runner in that situation.

 

I think what might be interesting is if Fred Olsen purchased P&O with CCL receiving an equity share in Fred Olsen.  They could easily serve the northern Euro market

Edited by Mary229
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This was always on the cards once Royal Caribbean acquired Silverseas. Azamara  and Silverseas are too close and Silverseas has a higher profile.

I think Cunard and P& O may be merged and possibly spun off but I also think that HAL has lost its way as a brand over the last few years - it’s very much competing with Princess and must have been damaged by  the fact that the traditional HAL passengers are ageing and prefer smaller but less profitable ships. Viking Ocean has taken passengers from HAL.

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5 hours ago, Roz said:

What is "equity scrap"?

They buy companies and strip out anything that cost money, don’t reinvest, and let it bleed for profit.

 

It sorta kinda works for Staples (and Aeropostale which they have done) but an asset-heavy cruse line is a different animal. 

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There will be others that disagree with me--OK with me.  But, RCI's decision to buy those former Renaissance Cruise ships which were dated in decor and small in size was a poor business decision initially.  Needed "something" to compete with Seabourn of CCL, I suspect, was a "guiding thought".  

 

I have friends who sailed on one of those ships when it was a Renaissance vessel:  never again, and their reaction was based on the physical layout of the ship.  I know another couple who sailed on one when it was an Azamara vessel:  enjoyed it.  

 

Personally, I don't see this transaction to be a threat to HAL.  

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