Star Cruises buys Project America ships
Northrop Grumman Corporation yesterday said that it had reached an agreement to sell all structures and material associated with the Project America cruise ship program to Norwegian Cruise Line.
Under the agreement, Norwegian Cruise Line will take possession by Sept. 30 of the nearly half-complete first ship and all associated equipment and materials, as well as material acquired by Northrop Grumman for a planned second ship. Approximately 350 Ship Systems employees are currently preparing the cruise ship for launch and towing.
The company does not expect the sale to impact previously announced financial guidance.
In May, says Nothrop Grumman, the U.S. Maritime Administration (MARAD) conducted an auction for the cruise ship and associated materials. Subsequently, MARAD directed Northrop Grumman Ship Systems to proceed unilaterally with the disposition of the vessel.
Northrop Grumman had previously been under contract to American Classic Voyages Company to construct two 1,900-passenger vessels. In October 2001, Northrop Grumman halted work after AMCV filed for Chapter 11 bankruptcy protection.
Norwegian Cruise Lines parent, Star Cruises, said that the substantially completed hull of the first vessel, plus all of the associated equipment and materials, will be transported to Europe, where work will be completed in one of the major cruise ship building yards. NCL is in advanced discussions with European yards to determine which one will complete the ship.
"We believe that the worse is behind us now and the Star Cruises Group in particular NCL has turnaround well in the last two years and we are now looking forward to further strengthen the NCL brand in the U.S. as it moves towards offering some of the best itineraries in North America, Bermuda, Bahamas and Caribbean which are the major cruising regions in the world," said Tan Sri KT Lim, Chairman, President and CEO of the Star Cruises Group.
"The Group's two-pronged expansion strategy in North America and Asia-Pacific i.e. China, which are geographically and culturally different, will leverage on the respective strengths of the NCL and Star Cruises brands in those regions while providing the Group with multiple exposures on different fronts. This will enable the Group to capitalise on future fleet deployment, marketing and seasonality synergies in the Group's global expansion and operations," added Tan Sri KT Lim.
"The acquisition of the 'Project America' assets was prompted by the success of Freestyle Cruising, the tremendous reception we have had to Norwegian Sun and Star, and the need to add ships as soon as possible after the delivery of Norwegian Dawn, our last scheduled new build, in December 2002," said Colin Veitch, President and CEO of NCL.
The original design of the "Project America" ship has been modified and the ships will sail under the NCL brand as the latest addition to the company's revolutionary Freestyle Cruising fleet.
"We were impressed with the initial creative design of the ship," Veitch said. "Now with the changes we have made, she will be an outstanding addition to our fleet, bringing to four the number of new purpose-built Freestyle Cruising ships we will introduce between 2001 and 2004."
In keeping with the groundbreaking Norwegian Sun and Norwegian Star (both introduced in the fall of 2001) and Norwegian Dawn (a 2,200-passenger sister ship to Norwegian Star), the new ship will feature many of the innovative hallmarks of NCL, including open-seating main dining rooms, multiple dining choices (eight restaurants), an Internet Café, state-of-the-art entertainment venues, three pools, an expansive spa and health and fitness center, extensive children's facilities and an abundance of spacious public rooms.
Eighty percent of the staterooms will have an ocean view, with 85 percent of those including private balconies - a total of five decks with private balconies. As with all Freestyle Cruising ships, guests will enjoy no fixed meal times, no assigned dining companions, resort-casual dress code, no cash-tipping, and a relaxed resort-style ambience.
Once the completion of the first vessel is under way, NCL will explore the feasibility of completing the second vessel based on the work in progress and materials that have been purchased as part of the deal with NGSS.