Royal Caribbean Cruises is borrowing $700m from five banks to pay for most of its two-thirds stake in Silversea Cruises.
The Miami-based cruise major in mid-June acquired 66.7% of the luxury and expedition cruise operator for $1bn.
The loan is being drawn against JPMorgan Chase Bank, Bank of America, Citibank, Goldman Sachs Bank and Morgan Stanley Bank, according to a regulatory filing. Each institution will contribute $140m.
The interest rate will range from a rate equal to Libor plus a margin of 0.9% to 1.5% per year or a base rate plus a margin of 0% to 0.5%, depending on Royal Caribbean's senior debt rating.
After a 60-day grace period, Royal Caribbean will pay a ticking fee of 0.08% to 0.2% per year for any unused portion of the loan, which will mature in one year.
