Carnival Corporation and plc have closed their €1 billion senior unsecured notes private offering. The senior unsecured notes have a coupon of 4.125% and are due in 2031.
The global cruise company notes that the legal document governing the notes has investment grade (IG)-style covenants, with chief financial officer David Bernstein indicating the firm’s intentions to break into the IG market.
He stated, “We continue to opportunistically access the capital markets. We are just one notch away from an investment grade credit rating and this successful transaction puts us further down that path.”
Fitch agreed: “This transaction represents a material step in achieving a total unsecured and non-guaranteed capital structure, positioning Carnival for an investment grade rating.”
The agency gave the notes a BB+ rating, with a recovery rating of RR4. Carnival as a whole has been assigned a positive outlook, thanks to scale, high operating margin, strong liquidity and the expectation of continued deleveraging, it added. This could change in the face of increased fuel prices or an economic downturn, Fitch added, which could reduce leisure demand.
Moody’s Ratings assigned a Ba3 rating to the notes, compared to the corporate family’s Ba2 rating.
Interest on the notes will be paid on an annual basis from 15 July 2026. Funds generated from the offering will be used to repay in total the company’s first-priority senior secured term loan facility, maturing in 2027. They will also repay a portion of the 2028 term loan facility.
The company aims to deleverage, reduce its interest expense, simplify its capital structure and manage its maturity profile.
©Markets Media Europe 2025
