Anchor Ship Partners' move to take a 50% stake in NYK Line's cruise subsidiary is part of a plan to help the giant Japanese shipowner fund a cruiseship newbuilding and refurbish an existing passengership.
Anchor is a Tokyo-based ship investment fund that was established with the aim of supporting the Japanese shipping industry. Its primary focus is investing in the long-term financing of newbuilding projects in the containership, tanker and car carrier markets.
Its decision to invest in NYK Cruises, which operates under the brand Asuka Cruise, is part of a new strategy to diversify its investment profile beyond newbuildings and into corporate finance.
Diversifying investments
In a statement, Anchor said it wants to help NYK Line fund the development of the cruise business, which includes investing in a newbuilding. The deal will also aid refurbishment of the 940-berth luxury cruiseship Asuka II (built 1990).
“For NYK Cruises to continue to develop the Asuka brand, the refurbishment of the existing ship Asuka II will be required to further improve the level of service to customers. Also, in the future, to be recognised as number one in the world cruise business we think it will be necessary to build a new cruiseship,” Anchor said.
“As a fund with more than 10 years' experience in developing specialist expertise in ship finance, we are confident we can support NYK Cruises’ Asuka in securing finance.”
Cutting capex
The involvement of Anchor will also help NYK Line achieve its goal in its current business plan of reducing capital expenditure.
NYK Line’s cruise business is focused solely on NYK Cruises and its cruiseship Asuka II. It sold its Miami-based cruise business Crystal Cruises to Hong Kong's Genting Group in 2015.
The Asuka II was built by Mitsubishi Heavy Industries' Nagasaki Shipyard as the Crystal Harmony for the international market. It primarily targets the domestic Japanese cruise population with round-the-world voyages to Hawaii and Alaska.
The Asuka II is now approaching 30 years of age and is due for replacement. The focus will turn to whether NYK Line will again commission Mitsubishi Heavy Industries, with which it has a historic business connection, for its newbuilding.
Mitsubishi Heavy Industries has built the majority of cruiseships for NYK group. However, a project to build two luxury cruiseships for AIDA Cruises recently rang up losses of more than $1.5bn for the yard and it has since withdrawn from the market.
