Short end of a cruise fare reduction

[Honeymooner2006]

Once again, I feel compelled to remind folks that NCLH acquired Oceania and Regent -- and promptly named the founder of Oceania as their President and CEO. It's highly unlikely that Mr. Del Rio is sanctioning any NCLH-based changes with his "baby".

 

I have no inside information on this, but mergers and acquisitions are not free. There may have been both long-term and short-term financing involved, and you have the administrative expenses of getting everyone under one roof. So I suspect that there has been a concerted push to raise cash. I have not met Mr. Del Rio, but he seems like a man who likes his job; if his job required him to cut some corners with his baby, I don't think he would think twice about it. People who rise to his level tend to quarantine whatever sentimentality they have.

 

BTW, NCLH released their first quarter results - today!

 

Oh... we can see the general outlines of the acquisition terms. Go here, look in Archived Events, under "Acquisition of Prestige Cruise International, Inc." (date 9/2/14), you will see "View Presentation," with a pdf of a PowerPoint. The transaction overview is on page 9.

[kekilia]

Your opinions may be your opinions, but please keep those that are about people whom you do not know personally to yourself.

 

As dozens if not hundreds of us on this board can attest from personal experience, Mr. Del Rio has been an honorable and true friend to us -and I don't just mean friend in the accepted "business" sense.

 

Our loyalty is something that FDR has earned over time. Remember, when the naysayers, and bankers, swore that the Carnival model was the only way to run a modern Cruise Line, he stood firm and his determination literally changed the Cruising marketplace.

 

Whatever changes occur today or tomorrow on those other Lines, my confidence remains that Frank Del Rio's vision for Oceania will remain intact.

 

I was not disrespecting him as a person and those tha know him and adore him, fine, I'll take your word that he is a great person. I am referring only to a CEO and business. In that, and I WILL MAKE MY OPINION KNOWN, I believe he does not care as much as you believe he does. I think he will do what he has to do as a CEO to swim with the fishes. So far, he has kept O as it has been and I certainly hope he continues this. But only time will tell. Mean no offense.

[hondorner]

FDR built a nice cruise line up from the ashes after bankruptcy by finding a niche and nurturing it. But now, he's moving on to bigger and better business heights. You are kidding yourself if you believe that he actually cares about anything but the bottom line and keeping himself in the top tier of his industry! Ha! Give me a break, he's out to line his pockets....

I think you'd be wise to stick with things you know for certain...first of all, Frank built Oceania from scratch, not from the "ashes of bankruptcy". Frank was gone from Renaissance before the bankruptcy after successfully building it up to the point where it could be sold. It was the new owners that pulled the trigger after the 9/11 tragedy.

 

Second, you have no idea to who you suggest they're "drinking the cool-aid". Over the years, there has literally been no one on cruise critic closer to FDR than Jan -- although Jim comes in a close second, and I've had my share of personal experience, also -- we know of what we speak.

 

Third, while FDR has overall management over all three cruise lines, it's rare today that he has day to day control over any of them. NCL direct management has been delegated to President Andy Stuart, a long time NCL exec. It was Mr. Stuart who, for example, admitted responsibility for, and apologized for, the poor handling of the room service fee experiment on Breakaway and Getaway. Jason Montague, who had been with FDR since the beginning, is the direct President of Oceania and Regent. FDR has pledged that each cruise line will continue to operate independently.

 

FDR was doing fine financially as Chairman and CEO of Prestige Holdings. He has no need to "line his pockets". His elevation to CEO of NCL Holdings was simply the recognition of the controlling shareholders that he was the best man for the overall position.

[kekilia]

I think you'd be wise to stick with things you know for certain...first of all, Frank built Oceania from scratch, not from the "ashes of bankruptcy". Frank was gone from Renaissance before the bankruptcy after successfully building it up to the point where it could be sold. It was the new owners that pulled the trigger after the 9/11 tragedy.

 

Second, you have no idea to who you suggest they're "drinking the cool-aid". Over the years, there has literally been no one on cruise critic closer to FDR than Jan -- although Jim comes in a close second, and I've had my share of personal experience, also -- we know of what we speak.

 

Third, while FDR has overall management over all three cruise lines, it's rare today that he has day to day control over any of them. NCL direct management has been delegated to President Andy Stuart, a long time NCL exec. It was Mr. Stuart who, for example, admitted responsibility for, and apologized for, the poor handling of the room service fee experiment on Breakaway and Getaway. Jason Montague, who had been with FDR since the beginning, is the direct President of Oceania and Regent. FDR has pledged that each cruise line will continue to operate independently.

 

FDR was doing fine financially as Chairman and CEO of Prestige Holdings. He has no need to "line his pockets". His elevation to CEO of NCL Holdings was simply the recognition of the controlling shareholders that he was the best man for the overall position.

 

Accept your criticism and your facts as I am not in the know. My statements tend to reflect my over all opinions about the oligarchy which I should reserve for better informed arguments. As a scientist and researcher, I am going to do my homework on this and I shall post when I am better informed. Wish everyone would do this when called on the carpet, we might actually be able to peacefully lead the world through perilous times. Thank you for your input. :(

[Wendy The Wanderer]

...The fixed seating was not a deal breaker for us as we usually eat at 8:30PM. ...

 

Just curious why the time you eat has anything to do with your liking or not liking fixed seating.

 

Accept your criticism and your facts as I am not in the know. My statements tend to reflect my over all opinions about the oligarchy which I should reserve for better informed arguments. As a scientist and researcher, I am going to do my homework on this and I shall post when I am better informed. Wish everyone would do this when called on the carpet, we might actually be able to peacefully lead the world through perilous times. Thank you for your input. :(

 

+1 "Like"

[Jancruz]

Accept your criticism and your facts as I am not in the know. My statements tend to reflect my over all opinions about the oligarchy which I should reserve for better informed arguments. As a scientist and researcher, I am going to do my homework on this and I shall post when I am better informed. Wish everyone would do this when called on the carpet, we might actually be able to peacefully lead the world through perilous times. Thank you for your input. :(

 

I admire you for accepting the criticism in the way you did..I agree, if everyone would be able to have civil conversations this would be a better world..I find the NCL board to be filled with thoughtless and cruel people who have no idea what is really happening at NCL and why....

Jancruz1

Edited May 9, 2015 by Jancruz

[Honeymooner2006]

I found this in NCLH's recently released 10-Q:

 

 

3. The Acquisition of Prestige

 

On November 19, 2014, we completed the Acquisition of Prestige. Consideration for the Acquisition of Prestige includes a cash payment of up to $50 million upon achievement of certain 2015 revenue milestones. The contingent consideration is valued using various projected 2015 revenue scenarios weighted by the likelihood of each scenario occurring. The probability-weighted payout is then discounted at an appropriate discount rate commensurate for the risk of meeting the probabilistic cash flows.

 

(Italics added.)

 

I thought it was interesting that there were so many Apollo people on NCLH's board (four of nine), given that O and Regent (aka Prestige) were owned by Apollo. Two of the four are LBO/reorg guys (and let's be clear, the entire board is all guys), but the one that caught my attention was this one: "David Abrams is the Founder & Partner, Non-Performing Loans for Apollo Management International LLP."

 

Now, I am not saying that NCHL has non-performing loans, but if there is anyone who knows how to work debt in a complex transaction, it would be someone like Mr. Abrams.

 

Taken together, I would surmise that our good private equity friends remain connected to the NCHL-owned cruise lines mostly through debt, and that the deal was mostly financed with Apollo taking a delayed full payment for Prestige. In fact, if you look at the pdf I linked above, the purchase price is $3.025B, with only $670M in NCLH shares to Prestige shareholders, and the rest financed with debt, bonds, and cash on hand. That is a lot of debt, IMO - yet I am not saying that anyone is on the verge of going under. It just strikes me highly leveraged.

 

I think they are correct about the synergies and I think you will continue to see more consolidation in the market. I think the big players will get bigger (because it helps to cut expenses and have leverage with vendors like airlines) and that the small players that survive will have to find their niche and do it very, very well (quite small ships with incredibly unique itineraries). Potential trends I (an outsider) am curious about: (1) the possible changes as emerging economies create an upper class in those economies that can afford cruising (e.g., marketing, itineraries, suite styles & layout, food choices, etc.), and (2) changes in the industry as US, Canadian, and European Gen-X'ers and Millennials (generally of a certain income level) prefer more adventure-style vacations than 75-people-on-a-tour-bus-hitting-the-highlights (although there are people who do organize their own shorex).

 

Over the years as I have glanced over Regent, O, etc., I have been utterly fascinated at how Mr. Conroy at Regent was replaced by Mr. DelRio, and now Mr. Del Rio has found himself in Mr. Sheehan's place. I know people have been discussing changes on-board entertainment. You can have the cabaret; I'd prefer the Leadership / Management Secrets of Frank Del Rio. :cool:

[hondorner]

I found this in NCLH's recently released 10-Q:...<snip>...

 

I thought it was interesting that there were so many Apollo people on NCLH's board (four of nine), given that O and Regent (aka Prestige) were owned by Apollo. Two of the four are LBO/reorg guys (and let's be clear, the entire board is all guys), but the one that caught my attention was this one: "David Abrams is the Founder & Partner, Non-Performing Loans for Apollo Management International LLP."

 

Now, I am not saying that NCHL has non-performing loans, but if there is anyone who knows how to work debt in a complex transaction, it would be someone like Mr. Abrams.

 

Taken together, I would surmise that our good private equity friends remain connected to the NCHL-owned cruise lines mostly through debt, and that the deal was mostly financed with Apollo taking a delayed full payment for Prestige. In fact, if you look at the pdf I linked above, the purchase price is $3.025B, with only $670M in NCLH shares to Prestige shareholders, and the rest financed with debt, bonds, and cash on hand. That is a lot of debt, IMO - yet I am not saying that anyone is on the verge of going under. It just strikes me highly leveraged.

 

I think they are correct about the synergies and I think you will continue to see more consolidation in the market. I think the big players will get bigger (because it helps to cut expenses and have leverage with vendors like airlines) and that the small players that survive will have to find their niche and do it very, very well (quite small ships with incredibly unique itineraries). Potential trends I (an outsider) am curious about: (1) the possible changes as emerging economies create an upper class in those economies that can afford cruising (e.g., marketing, itineraries, suite styles & layout, food choices, etc.), and (2) changes in the industry as US, Canadian, and European Gen-X'ers and Millennials (generally of a certain income level) prefer more adventure-style vacations than 75-people-on-a-tour-bus-hitting-the-highlights (although there are people who do organize their own shorex).

 

Over the years as I have glanced over Regent, O, etc., I have been utterly fascinated at how Mr. Conroy at Regent was replaced by Mr. DelRio, and now Mr. Del Rio has found himself in Mr. Sheehan's place. I know people have been discussing changes on-board entertainment. You can have the cabaret; I'd prefer the Leadership / Management Secrets of Frank Del Rio. :cool:

Not sure if you were aware that the reason Apollo had so many members on NCL's board is because they were significant owners of NCL. At one time, they had a 50% stake along with GentingGroup. Apollo then sold a slice to TPG Capital which resulted in a 37$ holding for Apollo. After NCL had their IPO, Genting owned 28%, Apollo 20% and TPG 7.9%.

 

Recently Genting sold some or all of their share, and the Genting board members resigned from NCLH, leaving Apollo as the major shareholder (Genting owns Star Cruises and is purchasing Crystal, intending to concentrate their efforts there).

 

Since Apollo created Prestige Cruise Holdings as a division when they combined Oceania and Regent, and owned the majority of Prestige (original shareholders, including FDR, owned 30%) and a significant chunk of NCL, they essentially created debt to themselves by the "purchase" of Prestige.

 

Frank Del Rio was the founder (along with Joe Watters) of Oceania, and arranged the sale to Apollo in 2007. When Apollo completed the purchase of Regent in 2008, they left Mark Conroy in position as President of Regent (Bob Binder was the President of Oceania) and named FDR as the Chairman and CEO of Prestige, presumably because they recognized his talent and genius in his unprecedented success with Oceania.

 

With the combination in November, 2014, NCL, Oceania and Regent are separate cruise lines under the umbrella of NCL Holdings. The reason why Kevin Sheehan gave up his position as CEO of NCLH have never been publicized, but most presume they were private and personal reasons. With the opening, Apollo, in control, presumably recognized FDR's talent and leadership one more time in naming him to the top position. Andy Stuart, an NCL veteran, is President of NCL and responsible for day to day operations. Similarly, Jason Montague, an Oceania veteran, is President of Oceania and Regent. The latter two have shared a President since Mark Conroy chose to step back.

 

There is nothing sinister in any of this, and FDR is not some sort of diabolical wizard chasing the top rungs. He is simply the best man for the job.

[Honeymooner2006]

There is nothing sinister in any of this, and FDR is not some sort of diabolical wizard chasing the top rungs. He is simply the best man for the job.

 

Don, you have been nothing but lovely to this Oceania newbie. That said, if you read anything "sinister" about my comment, it certainly wasn't because I put it there. It is a fact that every business union he is a part of, he comes out as the top guy. My comments were in the nature of professional admiration. If you're close to Del Rio, great, but the knee-jerk defensiveness is really confusing.

[Jancruz]

Don, you have been nothing but lovely to this Oceania newbie. That said, if you read anything "sinister" about my comment, it certainly wasn't because I put it there. It is a fact that every business union he is a part of, he comes out as the top guy. My comments were in the nature of professional admiration. If you're close to Del Rio, great, but the knee-jerk defensiveness is really confusing.

 

The reason he comes out as top guy is he is the best person for the job..he did not court the job he is in but he was needed..so he accepted..

we had lunch the end of December and he and Marcia were looking forward to doing something out of the cruise industry!!

Jancruz1

[hondorner]

Don, you have been nothing but lovely to this Oceania newbie. That said, if you read anything "sinister" about my comment, it certainly wasn't because I put it there. It is a fact that every business union he is a part of, he comes out as the top guy. My comments were in the nature of professional admiration. If you're close to Del Rio, great, but the knee-jerk defensiveness is really confusing.

Sorry, I've been spending too much time on the NCL forum lately, where they absolutely hate FDR, seemingly blaming him if their coffee is cold. To them, where changes are happening daily, he is the antichrist, and I guess I've gotten a little too sensitive.

[LHT28]

Sorry, I've been spending too much time on the NCL forum lately, where they absolutely hate FDR, seemingly blaming him if their coffee is cold. To them, where changes are happening daily, he is the antichrist, and I guess I've gotten a little too sensitive.

 

Don you need to stay away from that forum ;)

People think this forum has vicious people they need to check out the NCL forum :eek:

 

I gave up reading over there ... some are just OTT

 

Lyn

Edited May 10, 2015 by LHT28

[SellaVee]

Sorry, I've been spending too much time on the NCL forum lately, where they absolutely hate FDR, seemingly blaming him if their coffee is cold. To them, where changes are happening daily, he is the antichrist, and I guess I've gotten a little too sensitive.

 

Time to sit down and listen to the violin :).

[Jancruz]

Don,

I posted a few times over on that board and they ripped me..those people are awful..

I have also stopped reading over there unless it is about the Dawn which I am going on in September..I hope everyone over there that says they are going to cancel does before our trip..I do understand why they are so upset..everything is changing on their cruise line and we would be upset also but like you said they are vicious about Frank and all the changes..

Jancruz1

[Lane412000]

From my original post:

 

But, for a passenger like me who has booked a year in advance and paid Oceania my deposit, I am not given a reduced cabin fare like other passengers who are just purchasing the cruise now. And, the reason is because the cabin category I have purchased and assigned is now waitlisted. When Oceania decided to drop the price for the OC Suite, this category was not waitlisted. So, why didn't Oceania automatically reduce my cruise fare when they pushed out these new offerings?

 

 

 

The OC cabin is no longer waitlisted, so I contacted the TA to inquire to a lower fare. Hope to have a positive response back today. :D

[hondorner]

Don,

I posted a few times over on that board and they ripped me..those people are awful..

I have also stopped reading over there unless it is about the Dawn which I am going on in September..I hope everyone over there that says they are going to cancel does before our trip..I do understand why they are so upset..everything is changing on their cruise line and we would be upset also but like you said they are vicious about Frank and all the changes..

Jancruz1

You'll be OK on Dawn on a cruise longer than 7 days, in September, going out of the country (even if it's just Canada). I will not cruise NCL when school is on vacation, on cruises of 7 days or less, or in the Caribbean, or on the mega ships. Those cruises are where the vicious folks hang out, for the most part. When school is in session, on longer cruises to "furrin" countries, on the "smaller" and older ships, you'll be amazed at how much your fellow passengers are like Oceania folks (except the ones who sit all day at the plastic tables in the buffet playing board games, and never do anything else :eek:, and they're easily avoided. Also avoid walking past the Casino, as they still allow smoking in there).

[hondorner]

Don you need to stay away from that forum ;)

People think this forum has vicious people they need to check out the NCL forum :eek:

 

I gave up reading over there ... some are just OTT

 

Lyn

I'm still reading it, but mostly for the entertainment value. Sort of like watching Judge Judy...

[ORV]

I'm curious if those that can't seem to get any later perks or lower prices are using those travel agencies that offers the big rebates?

[LHT28]

 

The OC cabin is no longer waitlisted, so I contacted the TA to inquire to a lower fare. Hope to have a positive response back today. :D

 

I hope she checks her mail today :D

 

good luck

 

Lyn

[LHT28]

I'm still reading it, but mostly for the entertainment value. Sort of like watching Judge Judy...

 

LOL

I read occasionally when I am bored

I see they are liking the idea of lobster tail in the buffet but they do not want to pay extra fare for the better quality food

Just amazes me how people's minds works sometimes :D

[hondorner]

Don,

I posted a few times over on that board and they ripped me..those people are awful....

Ah, but Jan, they don't know who you are, yet, or how close you are to Frank. They think you're just some cranky old lady who is raining on their parade. They'll figure it out, some day, after they figure out how Frank actually made things better.

[Lane412000]

Good news, received the lower cabin fare since the cabin category is no longer waitlisted.

[cruisingxpert]

Good news, received the lower cabin fare since the cabin category is no longer waitlisted.

 

Congratulations! Hope you enjoy your cruise.:)

[LHT28]

good news, received the lower cabin fare since the cabin category is no longer waitlisted.

 

yeah!!!!

[Mura]

Great news!!! Have a wonderful time. :)

 

Mura