Andy Stuart to depart Norwegian Cruise Line

Norwegian Cruise Line president and CEO Andy Stuart in his office in 2015 with a framed jersey from London's Arsenal Football Club, his favourite soccer team. Photo Credit: Tom Stieghorst

Norwegian Cruise Line president and CEO Andy Stuart, a 31-year veteran of the company and long the company's bridge to the travel trade, will step down at the end of the year following the delivery of the last Breakaway Plus vessel, Norwegian Encore.

Stuart is beloved by agents for his warmth, humanity and deep knowledge of the business. He will stay on with the company as a senior advisor through March 31, 2020.

Norwegian named Harry Sommer, currently president, international for Norwegian Cruise Line Holdings, as Stuart's successor.

"I could only have dreamed about my journey at Norwegian when I joined the company in 1988 and am extremely fortunate to have witnessed firsthand the incredible evolution of this pioneering brand," said Stuart, who is 54 years old.

Stuart became president and chief operating officer in 2015, after the surprise resignation of Drew Madsen, who was in the job only five months. 

"Andy and Norwegian are virtually synonymous," Frank Del Rio, president and chief executive officer of Norwegian Cruise Line Holdings said at the time. "He is very well known and respected by our guests, travel partners, officers, crew, and team members.

Signature Travel Network CEO Alex Sharpe said Stuart's departure will be a blow not only to Norwegian but to the industry generally. "He's an incredible ambassador for the cruise industry. He's an incredible asset to the travel advisor trade. He's just an incredible man. A good friend, a loyal guy. From that perspective, any time we lose someone of that calibre from the industry, it hurts," Sharpe said.

Before he was named president in 2015, Stuart had been serving as executive vice president of sales. Prior to that, he had held many positions at Norwegian including global sales, passenger services, revenue management, and marketing and public relations.

"Andy has accomplished everything possible in the cruise industry, including leading its most storied and innovative brand," Del Rio said Thursday. "He will leave on a high note after delivering the brand's latest ship, Norwegian Encore."

Sommer's background includes stints at NCLH as executive vice president, international business development and executive vice president and chief integration officer.

He also held various positions at Prestige Cruise Holdings prior to its consolidation with NCLH, including chief marketing officer, senior vice president of finance, chief information officer and chief accounting officer.

Sommer holds an MBA from Pace University and a BBA from Baruch College.

Reinventing Norwegian

Reinventing Norwegian

Perhaps no company has had more revolution in the top management than Norwegian Cruise Line, which has had to structure new roles for executives following the $3.03 billion acquisition of Prestige Cruise Holdings and its two brands, Oceania Cruises and Regent Seven Seas Cruises. 

Closing the deal in November set off a cascade of changes that began with a new corporate structure under a parent company, Norwegian Cruise Line Holdings (NCLH). 

Next, Prestige President Kunal Kamlani resigned, followed two months later by NCLH CEO Kevin Sheehan.

With former Prestige Chairman and CEO Frank Del Rio stepping up to take Sheehan's place, openings were created for Stuart, 51, and Montague, 41, to step into brand president roles. 

Stuart, a 27-year Norwegian Cruise Line veteran with a long history on the sales side of the company, said in an interview after being promoted that he would continue to be more involved in sales than the average brand president.

"The key part of this role really is driving demand for the brand," Stuart said. "I'm going to be very, very involved with travel partners."

For their part, travel agents are thrilled to have Stuart in such a high-profile role because, said Signature's Sharpe, they credit him with the line's "Partners First" initiative and its support for the agent distribution channel.

"I keep getting members calling me," Sharpe said. "They're so happy for him and for us."

Only time will tell whether all the change at the top is ultimately good for the cruise industry and travel retailers. But like Sharpe, Wall is optimistic that the positive energy of new blood will outweigh the loss of experience and institutional memory at some lines.

"It's easy to have tunnel vision and automatically assume the way to go is the way it's always been," Wall said.

Coggins, too, said that on balance the changes are positive. 

"If you bring someone in from another industry, they come with fresh ideas," Coggins said. "They bring the perspective that will help attract the first-time cruiser."

Norwegian Cruise Line snaps up Ocean Princess as part of fleet expansion

Norwegian Cruise Line snaps up Ocean Princess as part of fleet expansion

Norwegian Cruise Line (NCL) has wasted no time in adding to the Oceania Cruises brand it recently acquired as part of its purchase of Prestige Cruises.

The firm has announced it has entered into a definitive agreement with Princes Cruises to buy Ocean Princess, a 684-passenger ship that will join the Oceania stable.

NCL will not take delivery of the vessel until March 2016, at which point it will undergo a $40 million (£25.4 million) refurbishment in Marseille before becoming the fourth ship sailing under the Oceania Cruises brand, joining Regatta, Nautica and Insignia.

The Ocean Princess is to be renamed Sirena and president and chief executive officer of NCL Kevin Sheehan said the deal ” provides measured capacity growth based on the proven platform of Oceania Cruises’ highly regarded mid-size ships”.

Customers will be able to book their place on Sirena for when it sets sail in April 2016 from March next year and NCL said the extensive refurbishment – set to take 35 days – will “elevate the ship to the Oceania Cruises’ standard of elegance”.

The firm will use the recent refurbishment of the Insignia as inspiration for the facelift and plans to incorporate Oceania’s two speciality restaurants – the Polo Grill and Toscana.

NCL has not yet released details of the routes and destinations and it has in mind for the Sirena, but with Oceania Cruises calling at over 330 points globally it is likely the ship will be well-travelled. President and chief operating officer at Oceania Cruises Kunal S Kamlani said the Sirena addition “opens up an entire array of new itinerary options”.

“The award-winning guest experience delivered on our ships, coupled with a collection of innovative itineraries that cater to new markets, will combine for an alluring siren song for both our current and future guests,” he remarked.

NCL confirmed the purchase of Prestige Cruises – the parent firm of Oceania Cruises and Regent Seven Seas Cruises – earlier this month. It is paying $3.025 billion for the company and the move means 22 ships – including the Sirena – will be under NCL’s control, with a further four due to be added over the next five years.

Travel agents seek details on Norwegian-Prestige merger

Norwegian Cruise Line moved up its regular Wednesday webinar by one day this week to address the agent implications of its $3 billion acquisition of Prestige Cruise Holdings.

Agents listening to the webinar asked Norwegian’s executive vice president, Andy Stuart, and Prestige President Kunal Kamlani about its effect on commissions, about how the loyalty programs will be handled and whether they will see a cheapening of Oceania Cruises and Regent Seven Seas Cruises to make the acquisition produce financial savings.

Both said several times that it will be “business as usual” for agents and consumers. “In our minds, it all starts with the clients,” Kamlani said.

On commissions, Kamlani said there are no plans in the next three months to change commissions for 2015. He said this is the traditional time of year to review agency agreements but that nothing should change because of the merger. “It is business as usual,” he reiterated.

The two executives said that how or whether to make Norwegian’s past guest loyalty benefits available to Oceania and Regent cruisers, and vice versa, was high on the list of things to consider but no decisions have been made.

Kamlani said in response to a question that he doesn’t expect to begin offering solo cruise rates after the merger. “We probably would never measure very well on that metric,” he said.

A question about merger savings hurting product quality at the Prestige brands drew a strong response from Kamlani.

“That travesty will not occur on any of our watches of anyone involved in this transaction. That’s as direct as I can be,” he said.

Norwegian Cruise Line to acquire Prestige Cruise Holdings

Updated: Norwegian Cruise Line to acquire Prestige Cruise Holdings

By Tom Stieghorst

Norwegian Cruise Line has announced it will acquire Prestige Cruise Holdings for $3.03 billion in cash, stock and assumed debt.

Norwegian said it will issue more than 20 million shares to help finance the purchase

.

Prestige includes Oceania Cruises and Regent Seven Seas Cruises.

Prestige shareholders are entitled to an additional contingency payment of $50 million “upon achievement of certain 2015 performance metrics,” a statement said.

Apollo Global Management controls Norwegian through a 20% ownership stake and rights to nominate a majority of the board of directors. Two other partners in Norwegian, Genting Hong Kong and TPG Pacific, have assented to the deal.

Merging Norwegian and Prestige would create a company that can appeal to a broader market swath than Norwegian can on its own, Norwegian CEO Kevin Sheehan said.

“The combination of three distinct brands, each serving a different market segment, under one umbrella immediately creates an industry-leading cruise operator with an unmatched growth trajectory and a portfolio of products that allows us to appeal to guests at every stage of their life cycle,” he said.

After the merger, Frank Del Rio will remain chairman of Prestige Holdings, the statement said. The companies expect the deal to close in the fourth quarter.

In a teleconference, Norwegian CEO Kevin Sheehan said he sees opportunity to use the business model from Oceania and Regent to do a better job of marketing Norwegian’s Pride of America ship in Hawaii. Pride of America is a one-off product with an unusual itinerary, which lends itself to some of the Prestige approach, he suggested.

Sheehan emphasized he has a long list of potential synergies beyond an initial $25 million but that implementing them cannot damage the guest experience.  He said the synergies will remain "behind the curtain” and invisible to guests.

The synergies Sheehan identified in the call are in areas such as purchasing, crew recruitment, port relations, fuel and insurance sourcing, maintenance and dry dock contracts and marketing sponsorships and partnerships.

Sheehan said there may also be consolidation of the two shoreside organizations, which are located within five miles of each other in western Miami-Dade County.

Prestige chairman Frank Del Rio, who turns 60 in two weeks, said he was committed to remain with the company through the end of 2015. “After that, we’ll see what happens,” he said.

Del Rio said the Prestige brands are best at executing a good cruise but haven’t been as sharp on cost savings because of the company’s small size.

Sheehan suggested that negotiations with Del Rio over the deal were at times acrimonious. “We had our moments in the negotiation process, but at the end of the day we’ve shaken hands and are best buddies again,” he said.

Sheehan suggested that the $50 million contingency payment was a way of building into the deal the Prestige view of its future performance, while not paying for it upfront in case it proves less than forecast.

Norwegian in talks to buy Oceania and Regent parent

Norwegian Cruise Line was last night reported to be in “advanced talks” to take over the parent company of luxury lines Oceania and Regent Seven Seas Cruises for around $3 billion.

Reuters cited “people familiar with the matter” and said a deal could be announced as early as this week.

A deal would give Norwegian, a company with a market value of $6.8 billion, access to Prestige Cruise Holdings' luxury ships and affluent clientèle as it competes with larger rivals Carnival Corporation and Royal Caribbean Cruises.

But sources cautioned that the talks could still fall apart. The owner of Prestige Cruises, private equity firm Apollo Global Management, also owns a 20% stake in Norwegian.

Miami-based Norwegian Cruise operates 13 cruise ships in North America, the Mediterranean, the Baltic, Central America and the Caribbean. It had revenues of $2.57 billion in 2013, up 13% from 2012.

Oceania and Regent together have eight cruise ships operating worldwide. Prestige posted revenues of $1.2 billion in 2013, up 6% from the year earlier.

Prestige registered with US regulators for an initial public offering in January. Apollo has been the company's majority shareholder following an $850 million deal in 2007.

Apollo made a $1 billion investment in Norwegian in 2008 and the company went public in January 2013.

Carnival, Royal Caribbean Cruises and Norwegian together account for 82% of the North American cruise passenger berth capacity, according to Prestige Cruises' initial public offering registration document.

Norwegian and Prestige representatives did not respond to requests for comment, while an Apollo spokesman declined to comment, according to Reuters.

Seven Seas Voyager emerges from drydock

By Tom Stieghorst

The 700-passenger Seven Seas Voyager is on a Rome-to-Venice cruise, its first since emerging from a scheduled drydock for interior and deck upgrades.

Among many changes, the ship's nightclub and observation lounge got new furnishings, wall coverings, carpeting and lighting. The Constellation Theatre was rejuvenated, penthouse suites were redone and new teak was installed on the balconies of all 350 cabins.

The refurbishment was overseen by Frank Del Rio, CEO of Prestige Cruise Holdings, parent of Regent Seven Seas Cruises. Del Rio flew to Marseille, France, for a final inspection before the Seven Seas Voyager set sail, the cruise line said.