Carnival Corporation & plc has announced the closing of a $3.0 billion 5.75% senior unsecured notes offering. The proceeds from this offering are to be used to fully repay borrowings under the senior secured term loan facility and to redeem $2.4 billion of 5.750% senior unsecured notes due 2027.
This move is part of the company's strategy to deleverage, manage future debt maturities, and reduce secured debt. David Bernstein, the Chief Financial Officer, stated that the company has already refinanced nearly $11 billion of debt and prepaid $1.1 billion of debt this year. Additionally, the company has reduced its secured debt by nearly 70% since its peak in the fourth quarter of 2021.
The notes will pay interest semi-annually at a rate of 5.75% per year and will mature on August 1, 2032. They will be unsecured and fully and unconditionally guaranteed on a senior unsecured basis by certain subsidiaries of Carnival plc. The indenture that governs the notes has investment grade-style covenants.
It is noted that the notes were offered only to qualified institutional buyers and non-U.S. investors. They were not registered under the Securities Act or any state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements.
This move is part of Carnival Corporation & plc's efforts to strengthen its financial position and continue its path back to investment grade credit. Following these announcements, the company's shares moved 0.24%, and are now trading at a price of $29.04. Check out the company's full 8-K submission here.
