Virgin Voyages has secured $550 million in new capital to support its growth plans

Virgin Voyages has secured $550 million in new capital to support its growth plans

The new funding – which was led by BlackRock and includes new external financing and additional capital from existing investors including Bain Capital Private Equity and Virgin Group – will enable the line to continue its growth strategy and further strengthen its financial position as demand "continues to gain momentum".

 

Tom McAlpin, chief executive of Virgin Voyages, said the company has created an "incredible project" that investors and consumers "truly believe in".
 

"This additional capital comes at a time when we’re looking forward to exponential growth that will, in turn, help us achieve what we set out to accomplish," he added.

The investment comes as Virgin reports "exponential growth in bookings" in the last six months, with this year tipped to see a strong return across the industry as cruising heads toward pre-pandemic levels.

 

According to research carried out by the line, 96% of consumers are keen to cruise this year following two years of restrictions. 

Virgin Voyages Announces Ship 3 Name and Itineraries

Virgin Voyages today announced its third newbuild will carry the name Resilient Lady and will set sail from Athens, Greece, embarking on two, seven-night itineraries starting in July 2022.

“Sailing in the Med is such an extraordinary experience, and we’re so excited to bring the adventure of a Virgin Voyage to this beautiful place,” said Sir Richard Branson, Founder of Virgin Group. “I’m so proud of the incredible work the team has accomplished to introduce Resilient Lady.”

Further expanding on the brand’s presence in the Mediterranean, Resilient Lady will offer two European itineraries, including:

● Greek Isles Itinerary: Sailors can immerse themselves in Greek history and culture in Athens before island hopping to Santorini, Rhodes, Crete, and Mykonos. The Greek Isles itinerary will feature an overnight stay in Mykonos, offering Sailors a premier location and tender access to the picturesque promenade.

● Adriatic (with Greek Isles) Itinerary: Sailing out of Athens, Sailors will spend their second day at sea before docking in Dubrovnik the following morning. With a 2:00 a.m. departure from Dubrovnik, Sailors will be afforded plenty of time to experience the rich history of Croatia during the day and take part in the active nightlife along the Adriatic Sea before scenic sailing to Kotor, Corfu, and Argostoli.

“Welcoming Resilient Lady to our fleet and revealing these amazing itineraries sets the tone for the most memorable summer voyage,” said Tom McAlpin, CEO, and President of Virgin Voyages. “We know the time to travel is on the horizon, and Virgin Voyages is here so that we can keep dreaming of irresistible vacations ahead.”

Branson to sell $500m space venture stake to support Virgin Atlantic

Branson to sell $500m space venture stake to support Virgin Atlantic

Sir Richard Branson aims to shore up his airline and travel interests hit by the coronavirus global travel shutdown by selling $500 million in Virgin Galactic shares.

Virgin Group told the New York Stock Exchange it planned to sell 25 million shares in the space tourism venture in a series of transactions.

The company said: “Virgin intends to use any proceeds to support its portfolio of global leisure, holiday and travel businesses that have been affected by the unprecedented impact of Covid-19.”

The freeze in global travel is affecting a host of Virgin Group companies, including Virgin Atlantic as well as its holidays, cruises and hotels businesses.

Virgin Atlantic last week announced it would cut 3,150 jobs, move it Gatwick operation to Heathrow and rebrand Virgin Holidays.

Chief executive Shai Weiss insisted at the weekend that he was “100% confident” the airline can survive the Covid-19 crisis.

The airline, in which founder Branson still holds a majority 51% stake, has been seeking emergency investment as well as some form of state aid while the majority of its fleet remains grounded.

About a dozen investment groups have been reported as showing interest in the UK long-haul carrier while talks continue with the Treasury and transport secretary Grant Shapps.

The airline was told last month that it needed to resubmit a £500 million bid for government state aid amid reports the Treasury had felt the carrier had nit exhausted other options.

Virgin Australia entered administration last month as the airline industry struggles to survive global travel restrictions imposed as a result of the Covid-19 pandemic.

Virgin Voyages Unveils Valiant Lady; 2nd Ship to Sail in Europe

Virgin Voyages announced its second ship will be called the Valiant Lady and that she will sail seven-night Mediterranean itineraries out of Barcelona, Spain when she debuts in May 2021.

Bookings for the three feature itineraries, that all offer overnight and late-night stops in destinations in France, Italy and Spain, will open December 19, 2019.

“We are thrilled to unveil the name of our second ship - Valiant Lady - and to deliver on our commitment to offering travellers a sea change in how they can experience cruising in this fantastic part of the world. Our Sailors will fall in love with the places we go and the moments and memories they will be able to create on our gorgeous ship. After all, there is no better way to sail the seven seas than doing it the Virgin way,” said Tom McAlpin, CEO of Virgin Voyages.

Virgin will offer three itinerary options from Barcelona. The first will call in Ibiza, Monte Carlo, Marseille and Olbia. A second offering will call in Ibiza, Toulon, Ajaccio, Marina di Carrara and Cagliari; and a third itinerary focuses on Ibiza, Palma de Mallorca, Malaga and the British port of Gibraltar. All three feature a Friday overnight in Ibiza.

Fincantieri Finalizes Shipbuilding Contracts with Virgin Worth 2 Billion Euros

File Photo: Sir Richard Branson with Virgin Voyages’ President and CEO Tom McAlpin as he arrives by helicopter for a news conference at the Perez Art Museum in Miami, Florida June 23, 2015. REUTERS/Joe Skipper

By gCaptain.com

Italian shipbuilder Fincantieri says it has finalized construction contracts for three new cruise ships worth a combined 2 billion euros with Virgin Voyages, the new cruise ship arm of Virgin Group.

The three ships will be built at the Fincantieri shipyard in Sestri Ponente (Genoa), Italy with delivery scheduled for 2020, 2021 and 2022 respectively.

Each ship will weigh about 110,000 gross tons, be 278 meters long and 38 wide. The ships will feature over 1,400 guest cabins that can host more than 2,800 passengers, accompanied by 1,100 crew members on board to deliver the famed Virgin service.

Based in South Florida, Virgin Voyages, formerly Virgin Cruises, is backed by lead investors Bain Capital Private Equity and London-based Virgin Group, whose founder and CEO is billionaire Sir Richard Branson. The shipbuilding contracts were first signed October but depended on closing of the multi-billion dollar financing package.

Steel cutting on the first of the three new ships is scheduled for early 2017, followed by keel laying in Genoa in the fourth quarter of 2017.

“These ships will stand out for original design and craftsmanship,” Fincantieri said in a statement Tuesday. “They will include some highly innovative ideas and design solutions, notably for energy recovery, reducing the overall environmental impact. For example, they will be equipped with an energy production system of approximately 1 MW, which uses the diesel engine’s waste heat. The result is, therefore, a project which distinguishes Virgin Voyages in the worldwide cruise scenery.”

Virgin Voyages’ first ship is expected to arrive at PortMiami in 2020 for a range of Caribbean itineraries.

Virgin Cruises tasked with offering distinctive experience on smaller ships

Virgin Cruise Concept Drawing.

Virgin Cruises’ decision to order ships that are smaller than those commissioned recently by its future competitors has prompted questions about whether it will have enough room to fashion a distinctive onboard experience.

The line, part of Richard Branson’s Virgin Group business empire, in June ordered three ships from the Fincantieri shipyard for delivery after 2020, when it plans to launch weekly Caribbean cruises.

The ships will each be about 110,000 gross tons and carry 2,860 passengers at double capacity, Branson revealed at an appearance in Miami last month along with Virgin executives.

That capacity is far less than recent orders, for example, for as much as 6,000 passengers for Carnival Corp.’s Aida Cruises brand in Germany, 5,400 for Royal Caribbean International, 4,500 for MSC Cruises, 4,200 for and 3,954 for Carnival Cruise Line.

All those lines sail at least one ship from Miami, the homeport where Branson said Virgin will launch its line.   

When it comes to setting prices, larger ships provide economies of scale that can help reduce fares while still generating profits.

“Virgin is in a very difficult position to differentiate themselves from everybody else. The key for their success is how they differentiate their onboard product.” — Art Rodney, Crystal Cruises founder

Tom McAlpin, president and CEO of Virgin Cruises, said that while pricing has not been disclosed, it will likely be above the cheapest fares advertised for seven-day itineraries.

“We’re not going to be a budget brand,” McAlpin said in an interview. “What Virgin has done in the past has been to give you a better experience at the same price point.”

To do that, it helps to have a generous amount of public space to work with. Virgin has not disclosed its onboard activities or designs yet but has emphasized that it will stand apart from the pack.

A key measure for new ships is the space ratio, which divides gross tonnage into the number of passengers carried. The higher the ratio, the more room for larger cabins and public spaces.

Mark Conroy, who helped design several ships as president of Regent Seven Seas Cruises in the 1990s, said the key question is how big the cabins will be on Virgin Cruises.

 “There is only so much square footage, particularly outside space, that needs to be divided between technical space, public spaces and staterooms,” Conroy said. “The technical space is pretty standardized, so then it becomes a balancing act between public space and suites and cabins. The larger you make the suites/cabins, the less space you have for public room.”

Art Rodney, one of the founders of Crystal Cruises, said that at 38.5, the Virgin ship’s space ratio is “no better than and in some cases worse than other large ships,” such as the MSC Divina or Royal Princess, both of which have space ratios of 40.

“Virgin is in a very difficult position to differentiate themselves from everybody else,” Rodney said. “The key for their success is how they differentiate their onboard product.”

McAlpin agreed, saying the “different programmatic elements” will set Virgin apart.

He said the ships are still in the design phase and urged potential passengers to weigh in on Virgin’s website to say what they would want to see and do on a Virgin vessel.

But McAlpin also said that if the ship is smaller than its competitors, that will make it different too.

“If everyone out there is building ships of one size and you have a different size, it does provide a level of differentiation,” he said.

McAlpin cited consumer research as the main factor in deciding how big to build. He said those surveyed expressed concerns about being on a mega ship with thousands of fellow passengers.

“We believe a slightly smaller ship gives us a good platform,” McAlpin said. “It’s big enough to provide us with a variety of experiences but small enough to provide a more intimate atmosphere.”

Can Virgin Group Solve the Cruise Industry's Old-People Problem?

Tim Boyle/Bloomberg

Sun, fun and drinks on a boat? That's about as logical a brand extension as one could imagine for Sir Richard Branson's Virgin Group, which plans to field two new, 4,200-passenger cruise ships late this decade and begin selling Caribbean voyages.

Virgin Group's expansion into the cruise market seems inevitable, given the company's long experience in travel and hospitality, from airlines to passenger rail to space travel to its first Virgin Hotel, which opens next month in Chicago. In fact, Virgin has been considering a cruise brand for several years, says Evan Lovell, a U.S.-based Virgin executive, but only moved ahead this year, after judging its brand image suitably well-formed and appreciated in the U.S. The United States is by far the world's largest cruise market, contributing more than half the estimated 22 million people who took a cruise this year, followed by the United Kingdom, Ireland and Germany. There is also room for new brands: Today, three cruise players control more than 80 percent of the market.

Virgin, along with its lead investor, Bain Capital, is betting it can solve for a longstanding problem in the cruise industry: Most customers are loyal, return cruisers, and the industry is keenly seeking to attract first-timers—cruise virgins, as it were. Along with what the industry dubs "cruise nevers," Virgin will target younger cruisers who "value a fun, youthful, energetic experience," Lovell says. "There is a misperception that the cruise business is an older person's experience."

The company will probably offer four-to-seven-day cruises in the Caribbean, complemented by sailings in the Mediterranean. Virgin's plans also were delayed due to deliberations about whether to retrofit older ships for the venture or to order new.

Also to Virgin's advantage, the industry has dialed back its effort to construct ever-larger ships, with more varieties of dining and entertainment. "They've reached the point where you can't simply build a bigger boat," says Ryan Cotton, a principal with Bain Capital. That suggests to Bain and Virgin that a cruiser's focus is shifting from the vastness of novel options onboard—bumper cars! rock climbing! skydiving! chocolate buffets!—to a cruise's overall service and experience. Ship size and over-the-top amenities will fade as the industry settles on ships that accommodate 4,000-4,500 passengers, Cotton says: "The industry has realized that this is almost exactly the sweet spot. It's big enough to provide all the onboard amenities you need but it's not too big that customers get lost."

The largest player in the industry, Carnival, considers land-based vacations its main competition and welcomes a new cruise brand, spokesman Roger Frizzell said in an email.  "The cruise marketplace represents only a small percentage of the overall vacation market today, so anything that can help stimulate new cruising guests is good for the industry as a whole," he wrote.

Of course, as the owner of a 105-foot luxury catamaran called Necker Belle, Virgin founder Branson has plenty of personal seafaring experience. If a Virgin Cruises voyage seems too mass-market, Necker Belle is available for charter--only $110,000 per week.