Carnival said it priced an upsized $3 billion offering of senior unsecured notes as it continues to shift its debt structure away from secured borrowings.
The cruise operator plans to use the proceeds to fully repay its senior secured term loan facility that matures in 2028, according to a company statement.
Remaining funds, along with cash on hand, will be used to redeem $2.4 billion of its 5.750% senior unsecured notes due in 2027.
The transaction is part of the company's strategy to reduce its secured debt and manage future maturities in a push to regain an investment-grade credit rating.
Upon completion, Carnival's remaining senior secured debt will be $3.1 billion.
The company noted that the security on this remaining debt would fall away once it receives an investment-grade rating from two of the three major rating agencies.
In a separate debt-related announcement earlier in the month, Chief Financial Officer David Bernstein said, "We are just one notch away from an investment grade credit rating and this successful transaction puts us further down that path."
The new notes will carry a 5.75% interest rate, mature in 2032, and the offering is expected to close on July 16.
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