Cruise operator Carnival Corporation is looking to issue new dollar bonds. Initial price talks are in the range of 4-4.125% area. Proceeds will be used to fund the buyback of up to $2bn of its outstanding 11.5% 2023s via a tender offer that was launched last week. Carnival is offering $114.25 for those bondholders who accept the deal by July 19. Citigroup is the main bookrunner of the deal. The cruise operator stands to save $150mn per year in interest costs if the buyback is completed, as per Bloomberg. The 11.5% 2023s were issued last year during the peak of the pandemic and the new proposed bond offering is likely to come in at much lower yields, capitalizing on the current low interest rate environment. Carnival had already completed a repricing in May in which it had cut a leveraged loan rate issued in 2020.
Carnival´s dollar bonds were stable with its 11.5% 2023s trading at 114.032, yielding 1.65%.
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