The Fed may have saved Carnival from having to pay over 15% interest on its new bonds
As the novel coronavirus spread across the globe, forcing Carnival and its competitors to halt new sailings and give refunds to some customers, David Bernstein, Carnival's CFO, determined that the company's expenses would amount to $1 billion per month, according to The Wall Street Journal's report. While the company was able to draw down $3 billion from its credit lines, its stock and bond prices were falling, potentially making it harder to raise more money.
Carnival enlisted investment banks like JPMorgan to help it find $4 billion to $6 billion in new funding, The Wall Street Journal reported. JPMorgan reportedly landed on a group of hedge funds: Apollo, Centerbridge Partners, Elliott, GSO Capital Partners, and Oaktree Capital Management. The group's proposal included debt with an interest rate of over 15% and a possible ownership stake in Carnival, according to The Wall Street Journal.
After the Federal Reserve increased the size of its lending program in March, JPMorgan was reportedly able to find new buyers for Carnival debt. The cruise company eventually raised over $6 billion in debt and equity, with the traditional and convertible bonds carrying interest rates of
Singapore Latest News, Singapore Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
You Have 15 New Netflix Treats To Binge This Weekend—This Is What's Worth Watching ASAPThere's more to Netflix this weekend than the Chris Hemsworth movie. So what should you binge ASAP?
Read more »
Vikings select record 15 players in seven-round draftThe Minnesota Vikings set an NFL record on Saturday by selecting 15 players over the course of a seven-round draft.
Read more »
Thailand reports 15 new coronavirus cases, no new deathsThailand on Sunday reported 15 new coronavirus cases and no new deaths, bringing the total number of cases since its outbreak in January to 2,922 cases and 51 deaths.
Read more »