Lindblad Merger: A Way to Expand
by Andrew Sheivachman /The merger announced last week of Lindblad Expeditions-National Geographic with an investment company will enable the expedition cruise line to go public and to finance the construction of two new ships, according to the line’s founder.
“We’ve been running at full capacity for some time now,” Lindblad Expeditions’ founder and president Sven-Olaf Lindblad told Travel Market Report.
“There are only so many ways to expand, and this was one of the variety of ways we could do it. This seemed like a smart way to bring in some capital.”
When the deal is finalized in May, Lindblad Expeditions will own 49% of the company while Capitol Acquisition Corp. II, its partner in the merger, will own 50%.
The company formed by the Lindblad merger, to be called Lindblad Expeditions Holdings Inc., will be valued at $439 million.
The merger comes on the heels of Norwegian Cruise Line’s high-profile acquisition last year of Regent Seven Seas Cruises and Oceania Cruises.
Accelerating growth
Lindblad Expeditions’ fleet currently stands at six company-owned ships and four charters. Their newest ship is the 102-passenger National Geographic Orion, which entered service in 2013. The 148-passenger National Geographic Explorer entered service in 2009.
“We have methodically expanded our fleet over the years,” said Lindblad. “So [growth] is not abnormal for us.”
At the same time, he expects more ships to be ordered in the near future. The company will raise up to $110 million in cash to help finance the new builds.
“We will accelerate [our growth rate] to some degree,” said Lindblad
Looking to the future
Following the transaction, Lindblad Expeditions will also extend its brand partnership with National Geographic through 2025.
The companies formed their alliance in 2014, also creating the Lindblad Expeditions-National Geographic Joint fund to raise money for research and conservation.
Lindblad expects the company’s new ships to be delivered in 2017 and 2018. They will have a look and feel similar to the Orion, which recently underwent a renovation to increase its public spaces and modernize furnishings and technology.
The line will also look to further develop its itineraries based on a mix of consumer expectations and creative innovation.
In 2015, for instance, Lindblad added new itineraries in diverse locations like Malta, Indonesia, Greenland, the Arctic, and the Azores.
“We will either expand in geographic areas where we know existing cruisers have an interest or go into new areas altogether,” said Lindblad. “It will likely be a combination of both.”