Crystal Cruises Sold To Genting Hong Kong For $550 Million

CRYSTAL SYMPHONY off Monte Carlo, courtesy of Crystal Cruises
CRYSTAL SYMPHONY off Monte Carlo, courtesy of Crystal Cruises

March 3, 2015

In a bit of surprising news guaranteed to shakeup the luxury segment of the cruise industry, Genting Hong Kong, owners of Star Cruises and a major shareholder in Norwegian Cruise Line have purchased Crystal Cruises, Inc. and their two ships CRYSTAL SYMPHONY and CRYSTAL SERENITY.   The CRYSTAL SYMPHONY is 20 years old, having been completed in 1995.  It carries 922 passengers aboard and measures 781 feet in length with a gross tonnage of 51,044.  The newer and larger CRYSTAL SERENITY was built in 2003.  Accommodations are provided for 1,070 passengers in her 820 foot length.  The ship measures 68,870 gross tons.  Both vessels are considered leaders in luxury cruising with a dedicated following of passengers.  Crystal Cruises itself was formed in 1988 when parent company Nippon Yusen Kaisha (NYK Lines) decided to enter the cruise business, building their first passenger ship since the second World War.  The CRYSTAL HARMONY was the result, entering service in 1990 for the Crystal Cruises division.  Since 2006 it has sailed exclusively for NYK as ASUKA II.  The company had recently stated their intentions to expand the line through either acquisitions or newly built ships so today’s announcement was quite an unexpected development.

CRYSTAL SYMPHONY off Monte Carlo, courtesy of Crystal Cruises.
CRYSTAL SYMPHONY, courtesy of Crystal Cruises.

The press release from Crystal indicated that the new owners do plan to grow the company with an innovative new build that they claim “will exceed all current and on-order luxury offerings in the global cruise industry.”  The announcement of the acquisition continued with the following statement from the Crystal Cruises side:

Today, Nippon Yusen Kabushiki Kaisha (NYK), Crystal Cruises’ parent company since its inception in 1988, announced it has entered into an agreement with Genting Hong Kong (GHK), under which Crystal Cruises will be acquired by GHK. The acquisition is expected to close in the second quarter of 2015.

With the support of GHK’s financial strength and expertise in ship design, Crystal Cruises’ fleet size will expand with a new ship, elevating the standard of luxury cruising and luxury cruise ships. Crystal’s fleet currently features CRYSTAL SYMPHONY and CRYSTAL SERENITY.

CRYSTAL SERENITY at sea, courtesy of Crystal Cruises
CRYSTAL SERENITY at sea, courtesy of Crystal Cruises

“After 25 successful years with NYK, we are excited to have Genting Hong Kong as the new owner of Crystal Cruises,” said Edie Rodriguez, President and COO of Crystal Cruises. “The proposed expansion of our fleet will present our loyal Crystal Society members and new luxury cruise guests with more itinerary options, accommodation choices and exceptional vacation experiences, as we continue to position Crystal as the innovative leader in global luxury cruising. Additionally, Crystal’s veteran leadership, management and crew will continue to focus on our award-winning guest service and our strong partnership with the travel agent community – which now has a greater opportunity to grow their business with a larger menu of Crystal product offerings.”

Established in 1993, GHK is part of the Genting Group, a global hospitality and leisure company with business in over 20 countries, including the United States in New York, Florida and Nevada. GHK wholly owns Star Cruises, Asia’s leading cruise line, and is a major shareholder of Norwegian Cruise Line. It is a public company primarily listed on the Hong Kong Stock Exchange and secondarily on the Singapore Stock Exchange.

“Crystal Cruises offers the epitome of luxury cruising and the service standard which all other cruise lines aspire to,” said Tan Sri Lim Kok Thay, Chairman, CEO and Acting President of GHK. “The current management team and crew will continue to lead Crystal Cruises. Genting will provide financial resources and proven expertise in innovative ship design to build a new ship that will set the highest standard in luxury cruise ships. This new ship, together with Crystal’s legendary six-star service, will reinforce Crystal Cruises’ reputation as the world’s leading luxury cruise line for decades to come.”

Under the terms of the agreement, GHK will acquire Crystal Cruises for US$550 million in cash which is subject to certain adjustment items [not to exceed US$600 million] to be ascertained after the closing. Crystal Cruises’ two ships have approximately 1,992 lower berths and the consideration has been determined on a cash-free and debt-free basis, translating into an enterprise value to lower berth ratio of approximately US$276,000.

Crystal Cruises has developed a reputation for taking care of guests in an inviting environment of extraordinary space, quality and choices.  The line claims to have earned more “World’s Best” awards than any other cruise line, resort, or hotel in history. Crystal Cruises has won “World’s Best Cruise Ship” in Condé Nast Traveler’s Reader Choice Awards for 21 years; voted “World’s Best Large Ship Cruise Line” by Travel + Leisure readers for 19-consecutive years; and both CRYSTAL SYMPHONY and CRYSTAL SERENITY were rated as two of the “Top 5 mid-size ships” by the 2015 Berlitz Cruising & Cruise Ships.  Parent company NYK, headquartered in Tokyo, operates nearly 900 other ships in addition to their three cruise ships.  New owners, The Genting Group have substantial investments in the cruise industry and also operate a 32,728 ton ferry, the BIMINI SUPERFAST (ex SUPERFAST VI)  from South Florida to their casino in the Bahamas.  The Malaysian controlled company also has interests in agriculture, resorts, real estate, oil exploration and bio-medical industries.

CRYSTAL SERENITY arriving in Venice, courtesy of Crystal Cruises
CRYSTAL SERENITY arriving in Venice, courtesy of Crystal Cruises

Competition in the luxury sector of cruising has been heating up considerably lately.  Both Seabourn Cruise Line and Regent Seven Seas Cruises have their largest and most luxurious ships ever currently on order.  German competitor Hapag-Lloyd operates the EUROPA 2 which is widely regarded as the most luxurious ship in the world.  Viking Ocean Cruises begins sailing their first ship this year and another new entrant Virgin Cruises has stated their intention “to shake up the cruise industry and deliver a holiday that customers will absolutely love.”  The acquisition of Crystal Cruises further consolidates a segment of cruising already under the control of several large companies, but should also assure that Crystal remains competitive with whatever new designs they introduce in the future.  The next few years will be interesting ones for luxury travelers at sea.




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