TPG Capital and Canada Pension Plan Investment Board (CPPIB) have made a minority investment of $500 million – $250 million each – for a combined stake of 17% in MISA Investments, the parent company of Viking Cruises. The transaction is expected to close by the end of the fourth quarter.
Viking Cruises has two operating units: Viking River Cruises, a European-based river cruise line, and Viking Ocean Cruises, an ocean cruise line launched in 2015.
Viking River Cruises operates a fleet of 59 vessels, all of which have been custom built or fully renovated since 1999, and 100% of the cabins are “outside” staterooms with windows or balconies. The ships also have onboard restaurants, bars, lounges, libraries and sun decks. The company christened 16 ships in a single day in 2014, breaking its own record that it held the previous year and earning it a place in the Guinness Book of World Records.
Viking Ocean Cruises operates two 930 passenger vessels – the Viking Star and Viking Sea – that currently sail the coasts of Scandinavia and the British Isles, and the waters of the Baltic Sea and the Mediterranean Sea. Viking will soon be adding four additional ships to its current ocean fleet – Viking Sky and Viking Sun are scheduled to launch in 2017 and two more ships are scheduled to launch by 2020.
Viking Cruises has a primary sales office in the United States, secondary sales offices in the United Kingdom and Australia, and operational offices in Switzerland. The company was founded in 1997 by CEO Torstein Hagen (www.vikingcruises.com).
“I am delighted that such prestigious institutions as TPG and CPPIB have become investors in Viking. This partnership and infusion of long-term growth equity capital will give us great opportunities to grow further, particularly in destination-focused ocean cruising as well as cruising in Europe for Chinese consumers,” said Mr. Hagen.
The Canada Pension Plan Investment Board (CPPIB) invests in public equities, private equities, real estate, inflation-linked bonds, infrastructure and fixed income instruments. CPPIB is headquartered in Toronto, with offices in London and Hong Kong (www.cppib.ca).
“Our investment in Viking is an attractive opportunity to invest in a market-leading business with an impressive track record, and substantial room for expansion,” said Pierre Lavallée, Senior Managing Director & Global Head of Investment Partnerships, CPPIB. “Viking’s business is exposed to a number of long-term growth drivers that our thematic investing group looks for, and believes will deliver strong risk-adjusted returns.” CPPIB’s thematic investing group researches and invests in securities that are exposed to long-horizon structural changes. Typically, theme-based investment portfolios span geographies and sectors.
TPG has been an investor in the cruise industry since January 2008 when it acquired a minority equity interest in Norwegian Cruise Lines. “Having been a long-time investor in the cruise industry, we see Viking as a market innovator that has re-imagined how people explore the world, with an iconic brand and strong product offering that has significant growth potential,” said Paul Hackwell, Principal at TPG. “Together with CPPIB, as the company’s first institutional equity investors, we look forward to partnering with Tor and the Viking management team to expand the business, both in products offered and regions served.”
TPG was founded in 1992 and makes investments throughout North America, Europe, Asia and Australia. Sectors of interest include industrials, retail, consumer, financial services, travel and entertainment, technology, media and communications, and healthcare. In May 2016, TPG held a final close of its latest fund, TPG Partners VII, LP, with $10.5 billion in commitments. The firm has offices in San Francisco, Fort Worth, Austin, Dallas, Houston, New York, Beijing, Hong Kong, Istanbul, London, Luxembourg, Melbourne, Moscow, Mumbai, São Paulo, Singapore, and Tokyo (www.tpg.com).
Credit Suisse (www.credit-suisse.com) was the exclusive placement agent to MISA Investments in connection with the transaction.
© 2016 Private Equity Professional • 9-16-16
