Bonheur ASA — M&A Activity 2020

Jul 15, 2020

Acquisition of cruise vessels and fleet optimization

Acquisition of cruise vessels and fleet optimization

Wholly owned subsidiaries of Bonheur ASA have today entered into agreements with

HAL Nederland NV (part of the Carnival Corporation Group) for the acquisition of

two cruise vessels to be operated by Fred. Olsen Cruise Lines Ltd., UK, which is

also a wholly owned subsidiary of Bonheur.

The vessels, which will be renamed MS Bolette and MS Borealis, were built in

2000 and 1997 and weigh GT 62,735 and GT 61,849, respectively. They each have a

capacity of approx. 1,400 available lower berths. This acquisition forms part of

an optimization of the Fred. Olsen Cruise Lines' fleet composition and with a

high yielding cabin mix and large public spaces, these vessels will enhance

Fred. Olsen Cruise Lines' earnings capabilities once operations can safely

resume. Delivery is expected to take place in the UK during September 2020.

Considering divestment of two vessels within the current fleet, such

optimization of Fred. Olsen Cruise Lines' fleet composition will imply Bonheur

itself contributing approx. GBP 7 million in financing to Fred. Olsen Cruise

Lines. The remaining financing requirements, which shall also cover any re

-branding costs, layup costs and pre-operating costs will i.a. be covered by a

seller credit of GBP 22.3 million and operating cash flow in relation to the

restart of cruise operations.

The seller credit will have a 5 years tenor with 3 years of zero amortization

and subsequent annual instalments of GBP 7.43 million at a 2.5% fixed interest

cost, an interest rate which reflects the negotiated parameters of the

transaction.

As to when to resume cruise operations, Fred. Olsen Cruise Lines will continue

to take advice and follow guidelines from relevant authorities, including the UK

Government and Public Health England as well as overseas policies. A decision on

safely resuming cruising will correspondingly be taken in close harmonization

with such institutions.

By optimizing its fleet and operations, Fred. Olsen Cruise Lines is positioning

itself to emerge from the current cruise pause in a stronger and more resilient

position.