August 12, 2015 – Genting Hong Kong Ltd is selling 10 million shares, or a 4.36% stake, in cruise operator Norwegian Cruise Line Holdings Ltd (NCLH) for US$590m.
Genting Hong Kong, in which Genting Malaysia has a 17.8% deemed interest, told the Singapore Exchange that its unit Star NCLC Holdings Ltd had on August 10th signed an underwriting agreement to sell 20 million NCLH shares in a secondary public offering.
The parties involved were (NCLH), the other selling shareholders (alternative investment manager Apollo and private investment firm TPG) and the underwriter Goldman Sachs & Co.
The sale proceeds will be payable by the underwriter in cash to Star NCLC on Aug 13, resulting in a gain of US$44.6m.
After the sale, Star NCLC’s stake in NCLH will fall to about 13.3%.
Based on the closing price of the NCLH shares on the Nasdaq Global Select Market on the date of the underwriting agreement, the market value of the 4.36% stake is about US$614.2m.
Genting Hong Kong said the board considered the offering as a good opportunity for the group to realise profits with cash inflow from partial realisation of its investment in NCLH.
“The directors believe that the terms of the offering are fair and reasonable, and in the interests of the company and its shareholders as a whole,” it said.
“To the best of the board’s knowledge, information and belief, having made all reasonable enquiries, the counterparties to the underwriting agreement and their ultimate beneficial owners are third parties independent of the company and its connected persons (as defined in the Listing Rules).”
NCLH is a diversified cruise operator of leading global cruise lines under the Norwegian Cruise Line, Oceania Cruises and Regent Seven Seas Cruises brands. For the year ended December 31, 2014, NCLH recorded a net income of US$342.6m.
The public offering, at US$59.25 per share, is expected to close on or about August 13.
Genting Malaysia shares fell 18 sen to close at RM3.79 today.
At an EGM last month, Genting Malaysia Bhd’s non-interested shareholders representing 75.84% of voting shares approved its indirect unit Resorts World Ltd’s proposed disposal of its 17.81% stake in Genting Hong Kong for a minimum price of US$472.2mil (RM1.9bil).
A news report mentioned some shareholders’ concern that the minimum price was much below the group’s original cost of investment in the disposal shares, which was US$604.1m.