Virgin Voyages raises capital, loses CEO and confirms fourth ship delay

2023-09-15T20:10:38+00:00 September 15th, 2023|Finance|

Recently, Virgin Voyages has announced that it had completed its next round of funding, is losing its founding CEO to retirement and has had to delay the delivery of its fourth ship.

The latest round of funding saw the closure of an additional $550 mill in capital, which was led by Ares Private Equity Group along with additional capital from existing investors, including Virgin Group and Bain Capital.

The new funding will enable Virgin Voyages to strengthen its financial position, while supporting the brand’s expansion, it said.

“With this new investment alongside our partners at Virgin Group and Bain Capital, we believe the company is on strong footing to capitalise on its differentiated product and value proposition in the growing cruise industry,” said Aaron Rosen, Partner and Co-Portfolio Manager of Special Opportunities in the Ares Private Equity Group.

An earlier funding round in August, 2022 raised $550 mill. This was led by BlackRock and Goldman Sachs as the placement agent. Bain and Virgin Group also contributed additional capital for the 2022 round, as well as continued support from existing lenders.

Coinciding with the funding announcement, Virgin Voyages reported that Tom McAlpin, an experienced cruise industry executive who joined the line in January, 2015, is retiring from the role as CEO.

He will move to Chairman of the Board of Directors and will be replaced as CEO by Nirmal Saverimuttu, who is currently President and Chief Experience Officer.

“It is hard to express just how proud I am of all that the Virgin Voyages crew has created and the strong endorsement we are receiving from Ares,” said McAlpin.

“While I will miss the day-to-day, I believe it is the right time to step aside as CEO.”

Virgin Voyages had a shaky start, due to the pandemic taking hold. Its first ship, ’Scarlet Lady’ was laid up for more than a year before starting her cruise schdule. The second cruise ship ’Valiant Lady’ entered service in 2022 and after an 11-month delay, the third cruise ship ’Resilient Lady’ entered service in May, 2023.

The fourth ship, ‘Brilliant Lady’, under construction at Fincantieri, is also the subject of a delay, the company confirmed, blaming unexpected construction, supply chain and staffing challenges.

She was due to be delivered late this year and be based at San Juan, Puerto Rico. However, no new delivery date has been revealed.

To cover her loss, the three vessels in service are having their 2024 itineraries re-worked.