Genting Hong Kong Ltd, an operator of casino cruise ships and an investor in Asian land-based casinos, has confirmed the sale of its Genting Dream vessel (pictured) for a total consideration of US$900 million. That figure – part of a deal flagged in September that includes the leaseback of the ship – was confirmed following two rounds of valuation, said the Hong Kong-listed company in a Tuesday filing.
The payment would be settled once the deal was completed “on or around 15 January 2020,” said Genting Hong Kong. The sale is part of a deal that includes a leaseback agreement for a period of 12 years, commencing from the date the ship is delivered to the purchasers.
In September, Genting Hong Kong said one of its units – Genting Dream Ltd – had agreed to sell the Genting Dream vessel for a total consideration of US$900 million or 80 percent of the closing market value – whichever was lower – at the time of completion.
In Tuesday’s announcement, the parent firm said: “As at the date of this announcement, both the first valuation and the second valuation have been obtained … Accordingly, the closing market value shall be the arithmetic average of the first valuation and the second valuation (which is US$1,147.5 million) and the consideration shall be US$900 million.”
Genting Dream, the first ship of the Dream Cruises brand, made its maiden voyage in April 2017. The vessel is one of the three existing cruise ships operated under the Dream Cruises business. As at June 30, the unaudited net asset value of the vessel was approximately US$862.5 million, according to a previous filing.
Genting Hong Kong has been seeking funds to finance the expansion of its cruise business. The company has developed a three-brand cruise portfolio with focus on different market segments: Crystal Cruises for what it terms the ultra-luxury segment; Dream Cruises for what it describes as the premium segment; and Star Cruises for what it defines as the contemporary segment.
On August 6, Genting Hong Kong had announced the sale of up to 35 percent of the equity interest in its unit Dream Cruises Holding Ltd for up to US$489 million.
In December, the Hong Kong-listed company said that another of its units had agreed to sell and lease back an under-construction vessel intended for its Crystal Cruises business. The liner – to be named Crystal Endeavor – is currently being built in one of Genting Hong Kong’s shipyards in Germany.
