December 20, 2004

NCL ordering Meyer newbuild, too

The NCL agreement with Aker Yards announced Friday is in fact one of a pair of newbuilding agreements that will see NCL Corporation build two new 2,400-berth Freestyle Cruising ships with delivery dates in time for the summer season of 2007.

In addition to the Aker Yards ship, NCL also plans a further ship to be built at Meyer Werft in Papenburg, Germany. It will be delivered in February 2007. The ship that will be built at the Helsinki, Finland yard of Aker Finnyards will be delivered in May 2007.

The orders are subject to documentation and certain conditions being fulfilled before becoming effective, says NCL, including the securing of specified financing packages. The aggregate effective all-up cost of the two ships is estimated to be Euros 770 million, or approximately U.S. $1 billion at today's exchange rates.

The Meyer ship will be an exact repeat of the Norwegian Jewel, currently under construction at that yard and due for delivery in August 2005. It will have 2,384 lower berths, 10 restaurants, an expansive top-of-ship complex of Garden Villas and Courtyard Villas, multiple lounges, bars, and entertainment venues, and some 540 staterooms and suites with private balconies.

The Aker Finnyards' ship will be a new design, incorporating all of the features of the series of purpose-built Freestyle Cruising ships that NCL has introduced since 2001. Slightly larger in capacity than the Meyer ship, it will have around 2,430 berths. Additionally, it will have over 840 staterooms and suites with private balconies. In a first for the industry, every outside stateroom on this huge ship will have its own private balcony.

The Aker Finnyards' order will include an option for a second ship, for delivery in early 2008, with exercise of the option by end of August 2005.

Commenting on the new orders, Star Cruises chairman Tan Sri K T Lim said: "These new orders confirm our strong confidence in this business and our commitment to rapidly renewing the NCL fleet and putting ourselves in the position very soon of having the youngest fleet in the industry."

The two new ships will be the eighth and ninth new ships introduced to the NCL fleet since Star took control of the company in early 2000, bringing the investment in new ships since that time to over $3.75 billion.

According to Colin Veitch, President and CEO of NCL, "We are very pleased to have been able to strike these deals at prices that make sense for us in spite of the weak dollar exchange rate. We will be building with two excellent shipyards and we know that these will be top quality, high-earning ships and strong additions to our Freestyle Cruising fleet.

"We are very pleased indeed to be continuing our relationship with Meyer Werft, a relationship that has spanned almost a decade and that has resulted in the delivery already of four world class ships to our group, and now a total of three more on order. With Meyer we know what we are getting and we are very satisfied with that."

Since 1998, Meyer has delivered Superstar Leo (now Norwegian Spirit), Superstar Virgo, Norwegian Star, and Norwegian Dawn, and is building Norwegian Jewel, Pride of Hawaii, and now this additional repeat of Norwegian Jewel.

"We are equally pleased", Veitch said, "to be re-opening our relationship with Aker Finnyards after an interval of roughly 16 years since the same shipyard delivered the NCL ship Seaward in 1988. And we are excited at the design solution we and the yard have been able to arrive at that gives an unprecedented number of balcony cabins on a Panamax ship. It will be the "richest" ship in the NCL fleet in terms of revenue potential."

NCL has a program in place to transfer to Star Cruises, all six of the mid-size middle-aged ships that constitute the core NCL fleet from pre-Star days. Between 2005 and 2009 over 8,000 berths will leave the NCL fleet, and therefore a major new building program is under way not only to replace those transferred berths but also to continue to grow the fleet at the same time. By expanding its building activities beyond its traditional one yard, NCL will access greater capacity to meet these needs.

"We wanted two new ships in time for the summer of 2007," Veitch said, "and no one yard could do that for us so we are now at the point where it makes sense for us to start working with more than one yard."

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