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Saudi fund in early talks to potentially buy Carnival’s ultra-luxury Seabourn brand

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An aerial view of Seabourn Encore cruise ship docked at Bodrum Cruise Port on April 27, 2022, in Mugla, Turkey.

Ali Balli | Anadolu Agency | Getty Images

Carnival is in preliminary discussions to sell its Seabourn ultra-luxury cruise brand to the Saudi sovereign wealth fund, people accustomed to the situation told CNBC.

Talks between the 2 parties are still ongoing. A deal of this size would give the Saudis a stronger footprint within the cruise industry, at a time when travel continues to rebound across the Middle East.

It could also give Carnival access to more capital, with shares losing over 40% prior to now three months. The value tag for Seabourn wasn’t immediately clear.

Carnival said it won’t comment on rumor or speculation. The Saudi fund, also referred to as Public Investment Fund, didn’t immediately reply to a request for comment.

Talks to sell Seabourn come lower than per week after Carnival raised over $1 billion within the debt market at a yield of 10%.

Seabourn got here to market in 1988 and operates six ships. Its destinations span from Antarctica to the Middle East to the Caribbean.

The Saudi sovereign wealth fund, also referred to as the Public Investment Fund, purchased a stake in Carnival at the peak of the pandemic in 2020. It currently has a 5.1% stake in Carnival, in line with FactSet.

Private equity firms have also been buyers within the cruise space. In March 2021, Royal Caribbean sold its Azamara cruise brand to Sycamore Partners for $201 million. Each TPG and Apollo Group invested billions in Norwegian Cruise Line in 2008, eventually taking the cruise operator public in 2013. TPG is currently invested in Viking Cruise, while Bain Capital is Virgin Voyage’s foremost investor.

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