Asian cruise ship operator, Genting Hong Kong Limited, has reportedly announced the signing of a deal that is to see it sell up to a 35% stake in its Dream Cruises brand to an entity controlled by private equity firm TPG Growth in partnership with the Ontario Teachers’ Pension Plan.
According to a report, the Hong Kong-listed firm used an official Tuesday filing (pdf) to reveal that the arrangement is to involve it offloading a minimum 24.5% shareholding in its Dream Crises brand to a venture known as TPG Darting next month before disposing of a further 10.5% stake to the same endeavor before the end of the year.
Itself a subsidiary of Asian casino operator, Genting Malaysia Berhad, Genting Hong Kong reportedly divulged that the first tranche of shares is to see it receive around $342 million in cash before a further $147 million is booked via the ensuing allocation. The operator, which is also responsible for the Crystal Cruises and Star Cruises brands, purportedly declared that its new partner has moreover agreed to award it with ‘additional incentive payments’ based on the ‘achievement of certain profitability level of Dream Cruises and delivery of each of the Global Class ships.’
Genting Hong Kong Limited currently operates three cruise ships under its Dream Cruises brand encompassing the Genting Dream, World Dream and Explorer Dream vessels. GGRAsia reported that these ships feature casinos offering a selection of slots and gaming tables and welcome passengers primarily from ports in southern China and Singapore.
Genting reportedly used its filing to describe TPG Darting and its parents as ‘highly reputable’ private equity institutions and that the new alliance represents ‘a significant vote of confidence in Dream Cruises.’ The operator furthermore purportedly proclaimed that the proceeds from the transactions are due to be used to ‘increase the liquidity of the company’ and help it to ‘fund its continued expansion and new ship building program’, which encompasses the premiere by mid-2022 of a pair of innovative Global Class ships.
Reportedly read the filing from Genting…
“The disposal will strengthen the group’s balance sheet and its ability to continue to expand its fleet in the cruise industry. The disposal will also reduce the group’s financial burden in meeting future funding requirements in relation to its Dream Cruises business.”