Cruise line Viking IPO fetches US$1.54 billion

 

Viking Holdings Ltd. priced its initial public offering near the top of a marketed range to raise US$1.54 billion for the luxury cruise operator and two investors.

Viking is offering 11 million shares and the selling shareholders are offering about 53 million for $24 apiece, the company said in a statement, confirming an earlier report by Bloomberg News.

Best known for its art- and history-rich river tours of Europe, Viking had marketed the shares for $21 to $25 each. It increased the number of shares offered by private equity firm TPG Inc. and the Canada Pension Plan Investment Board at the time of the pricing, while the size of the potential over-allotment was also increased to 9.6 million shares.

At the IPO price, Viking will have a market value of $10.4 billion based on the outstanding shares listed in its filings with the U.S. Securities and Exchange Commission.

Viking’s founder, Chairman and Chief Executive Officer Torstein Hagen, will continue to control the company with his daughter Karine Hagen, exercising 87 per cent of the company’s voting power. TPG and CPPIB will each control 4.5 per cent of votes.

Founded in 1997, Viking operates cruises around the world and has 92 vessels, according to the filing. It has more than 10,000 employees in over 90 countries.

While the company has expanded beyond its original tours of rivers such as the Danube and the Rhine, it continues to cater to older, wealthier travelers seeking “more than just a vacation,” Torstein Hagen said in the company’s prospectus.

“We maintain a clear focus on our most relevant customer group: English-speaking travelers aged 55 years old and over, who have the time, money and desire to explore the world,” Hagen wrote. “We do not try to be all things to all people, which is why we only offer a single-language experience on board our ships; there are no casinos; and children under 18 are not allowed.”

Viking is the second-biggest consumer-oriented company to go public on a U.S. exchange this year, after the $1.57 billion listing by Amer Sports Inc. in January. Since then, an assortment of tech, health-related and industrial businesses have held IPOs, raising more than $13 billion not including Viking, according to data compiled by Bloomberg.

Bermuda-based Viking is joining its publicly traded peers Royal Caribbean Cruises Ltd., Carnival Corp. and Norwegian Cruise Line Holdings Ltd. Royal Caribbean, the largest of them with a market value of about $37 billion, is the only one of the three whose shares have climbed back to where they started before the coronavirus pandemic.

In 2022, Viking reported a profit of $399 million on $3.2 billion of revenue, which rose sharply compared to the previous two years as the pandemic ebbed. Last year, the company lost $1.8 billion as revenue grew to $4.7 billion. The filings show adjusted earnings before interest, taxes, depreciations and amortization of $1.09 billion for 2023, which included a gain of about $2 billion from the re-measurement of derivatives associated with preference shares that will convert with the IPO.

Viking’s offering is being led by Bank of America Corp., JPMorgan Chase & Co., UBS Group AG and Wells Fargo & Co. Viking’s shares are expected to begin trading Wednesday on the New York Stock Exchange under the symbol VIK.