Royal Caribbean to buy 50% stake in Sandals Resorts for $3 bln

Royal Caribbean Group announced on Wednesday its intention to acquire a 50% stake in Sandals and Beaches Resorts for approximately $3 billion. This acquisition aims to expand the cruise operator's presence within the all-inclusive resort market. The partnership between the two companies will merge Sandals and Beaches Caribbean resort portfolio with Royal Caribbean's cruise, private destination, and vacation businesses.

Royal Caribbean disclosed that the deal places a value on the resort business at around 10 times forward earnings before interest, taxes, depreciation, and amortization (EBITDA). To finance this transaction, the company has secured committed debt financing from Morgan Stanley. The deal is anticipated to conclude in early 2027, pending regulatory approvals and other customary conditions. Royal Caribbean anticipates that the partnership will bolster earnings in the upcoming year.

Under this arrangement, Sandals Executive Chairman Adam Stewart will maintain a leadership position in the joint venture, alongside Royal Caribbean's Chief Executive Jason Liberty. Together, they will strive to accelerate the growth of Sandals and Beaches resorts, while simultaneously broadening their distribution channels. Additionally, customers will have the opportunity to enjoy resort and cruise experiences across both companies' portfolios.