Royal Caribbean Cruises Ltd. (RCL) announced today that it had agreed to sell its 50 percent interest in Island Cruises to First Choice Holidays Ltd., the other 50 percent owner in the joint venture and a subsidiary of British-based tour operator TUI Travel PLC (TUI). As part of the transaction, RCL and TUI agreed to an early termination of the charter of Island Star, one of two ships in the Island Cruises fleet. RCL is the owner of Island Star and had chartered it to Island Cruises.

The deal is subject to regulatory approval in Ireland. RCL will also recognize a small gain on the sale of its interest in Island Cruises and the early termination of the Island Star charter.

"We thank TUI for their efforts and cooperation throughout the life of the joint venture. Island Cruises has been a rewarding investment for us, but over the past year our priorities have shifted," said Richard D. Fain, chairman and chief executive officer of Royal Caribbean Cruises Ltd. "We believe by focusing on developing and expanding the Royal Caribbean International and Celebrity Cruises brands in the U.K. we will be better able to serve our customers and create value for our shareholders. This belief has been strengthened by the success of the inaugural season of Independence of the Seas, which has served the U.K. market from Southampton, U.K., since it entered service in May 2008," Fain added.

Upon its return in April 2009, RCL plans to redeploy the Island Star to Pullmantur Cruises, its Spanish brand. "Redeploying the Island Star to our expanding Pullmantur fleet allows us to better serve the strategically important Spanish market," said Fain.

Pam

[ 10-06-2008: Message edited by: PamM ]

It will be nice to see HORIZON and ZENITH together again. I would love to see HORIZON get her original name back but I doubt that will happen.

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Originally posted by dougnewman:

This means Pullmantur will have four ships I have sailed in... (ex) HORIZON, ZENITH, EMPRESS and SKY WONDER. I have never been so well-acquainted with a cruise line's fleet without having even stepped foot on one of its ships.

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Originally posted by Jekyll:
So i guess we need to keep an eye on your future cruise bookings so we can determine the evolution of this fleet

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(Not to say she's the next ship I'll sail in, it's all the way in July so something[s] may come up before then.)

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Originally posted by eroller:
Divesting Island Cruises is probably a good thing, but just how much tonnage can Pullmantur absorb? Also, no mention of ISLAND ESCAPE. I guess RCI no longer holds any monetary interest in this ship, or it's included in the 50% interest that RCI is selling to TUI.

Ernie

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TUI's UK MD, Dermot Blastland, says ISLAND ESCAPE is being transferred to Thomson Cruises. This is probably why Thomson did not want to take NORWEGIAN DREAM which Louis Cruise Lines had originally intended to acquire for charter to Thomson. This, together with the technical issues involving NORWEGIAN DREAM, were the probable reasons for the cancellation of the acquisition from NCL.

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Originally posted by rd77:
Vaccaro said before that ISLAND STAR could end up with Crosieres de France, let's see if that happens (I believe they technically come under Pullmantur's responsibility).

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I think it does. The Excel spreadsheets I've seen recently with the deployments of all the Pullmantur vessels up to 2010, include BLEU DE FRANCE.

With Pullmantur getting the much larger SOVEREIGN as a replacement for OCEANIC, I doubt whether that brand could absorb yet another ship so quickly. CDF is apparently keen on a second, so my bet is on ISLAND STAR heading in that direction.

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Originally posted by rd77:
Vaccaro said before that ISLAND STAR could end up with Crosieres de France, let's see if that happens (I believe they technically come under Pullmantur's responsibility).

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[ 10-07-2008: Message edited by: Waynaro ]

It does raise a few interesting points:

I would have thought RCI would have wanted to leave Island Star with Island rather than move her to Pullmantur purely because with a recession looming they would have been better off moving either Majesty or Monarch over to join Sovereign which would have maximised Pullmantur's potential. Now that Sky Wonder is moving to Mexico permanently instead of Ocean Dream ........

I am surprised that TUI didn't want to keep Island Star to replace Norwegian Dream, unless they see a downturn in their marketplace ?

Now RCI has acted on this how long before they act on Azamara ?

"Island Escape to join Thomson Cruises’ fleet
7/10/2008
TUI UK & Ireland, the owner of Thomson Cruises and soon to be 100% owner of Island Cruises, having agreed to buy the remaining 50% of its joint venture in Island from Royal Caribbean Cruises Ltd (see yesterday’s story), plans to integrate Island Escape into the Thomson fleet next spring.
It is undecided yet if the Island brand will then disappear but the plan is to move Island’s operations to TUI’s head offices in Luton under Thomson Cruises.

Currently Island Cruises operates two ships, Island Escape and Island Star. The planned itinerary of Island Star will remain unchanged for this winter and the ship will continue to sail in the Caribbean under the Island Cruises banner until April 6, 2009. On that date, it will be redelivered to Royal Caribbean and go under the Pullmantur brand.

Island Escape will be retained by TUI and will continue to operate its published itineraries throughout, in Brazil this winter and Palma de Majorca from next March.

Island Cruises’ md Patrick Ryan will be leaving the company after 15 years but will remain until Christmas to support the transition. David Selby, director of cruising at Thomson will lead the review of the new intergrated cruise businesses.

Selby told Seatrade Insider today, ‘both brands are known for their friendly atmosphere and for their crew who make people feel special.’ He added the only difference currently between the two brands is the dining with Thomson's ‘contemporary’ concept offering seated waiter service and a buffet option, if desired, whilst Island offers the reverse with ‘casual’ the norm and waiter service available as an add-on supplement. Selby said after integration, the plan is to maintain Island Escape’s casual dining and maybe convert some exiting Thomson ships or add newer tonnage to this style to create two sub-brands.

From next spring Thomson will have five ships in the fleet with the addition of Island Escape as it will not be renewing its Emerald charter. Thomson Destiny and Island Escape will cruise in the West Med, Thomson Celebration out of Corfu and adult-only ship, Calypso, out of Thessaloniki. Thomson Spirit will cruise ex-UK to the Baltics. "

Have to say I am not sure this is a good idea - they run the risk of getting like P&O with some ships doing this and others doing that - unless they do decide on having 2 brands.

The Island Star was a breakthrough for Island Cruises, just what it needed to compete with Ocean Village in terms of ship quality. This leaves the market open for OV unless Thomson rethink their cruise strategy.

The Island Escape is long past it's 'use-by' date yet it's being 'sold' again! An ugly ship that only manages to market itself with blisteringly cheap cruises with all inclusive upgrades stuffed in. I cannot see how they will convert her into the formal dining offered by Thomson at the current time. The main restaurant is geared for buffet style with smaller restaurants operating waiter service with a cover charge.

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Originally posted by ahrpd:

I think it does. The Excel spreadsheets I've seen recently with the deployments of all the Pullmantur vessels up to 2010, include BLEU DE FRANCE.

With Pullmantur getting the much larger SOVEREIGN as a replacement for OCEANIC, I doubt whether that brand could absorb yet another ship so quickly. CDF is apparently keen on a second, so my bet is on ISLAND STAR heading in that direction.

Tony

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"Redeploying the Island Star to our expanding Pullmantur fleet allows us to better serve the strategically important Spanish market," said Fain.

[ 10-07-2008: Message edited by: cruceromania ]

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Originally posted by mike sa:
I am not surprised given the rumours of Island's non financial performance. I suspect Island Escape will end up in Brasil.

It does raise a few interesting points:

I would have thought RCI would have wanted to leave Island Star with Island rather than move her to Pullmantur purely because with a recession looming they would have been better off moving either Majesty or Monarch over to join Sovereign which would have maximised Pullmantur's potential. Now that Sky Wonder is moving to Mexico permanently instead of Ocean Dream ........

I am surprised that TUI didn't want to keep Island Star to replace Norwegian Dream, unless they see a downturn in their marketplace ?

Now RCI has acted on this how long before they act on Azamara ?

Now that RCI have decided to concentrate on promoting Celebrity to the UK market they will need to ensure that the product is more of what it used to be in terms of quality to ensure pax know it is worth paying a bit more and get a good quality cruise experience in a contemporary setting. If they do then P&O and Cunard will need to watch their backs ! I have cruised a few times with P&O and Cunard regulars who loved Celebrity and moved their loyalty over for the quality - of course that has not quite been the same of late. But if they get back to as good as they were they will be on a winner.

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Mike,

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Originally posted by mike sa:
From CC

"Island Escape to join Thomson Cruises’ fleet
7/10/2008

From next spring Thomson will have five ships in the fleet with the addition of Island Escape as it will not be renewing its Emerald charter. Thomson Destiny and Island Escape will cruise in the West Med, Thomson Celebration out of Corfu and adult-only ship, Calypso, out of Thessaloniki. Thomson Spirit will cruise ex-UK to the Baltics. "

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I have just received an email flyer from Island Cruises advertising summer cruises on ISLAND ESCAPE till the end of October 2009.

Does this mean that plans have again changed?