Debt-laden Saga has mentioned it’s ‘exploring alternatives’ for its cruises enterprise – which may even end in its sale.
The firm, which specialises in insurance coverage and holidays for over-50s, mentioned it was a ‘partnership settlement’ because it tries to drive down its spiralling money owed.
A spokesman mentioned: ‘The board is exploring alternatives to optimise Saga’s operational and strategic place in cruise, the place distinctive demand for its boutique Ocean Cruise provide means it’s working at near capability.
‘No choice has but been made and there could be no certainty that any partnership settlement will happen. An additional announcement might be made sooner or later, as applicable.’
Saga refused to rule out a sale and it’s understood that each one choices are on the desk.
Debt-laden: Saga mentioned it was a ‘partnership settlement’ because it tries to drive down its spiralling money owed
The replace, which despatched shares hovering 6.3 per cent, or 9.2p, to 156p yesterday, got here after Sky News reported that Saga was contemplating promoting its vessels or dumping the enterprise beneath a licensing association.
This is forward of a £150m bond reimbursement due in May and the continuing stress of its £650m debt pile. The firm didn’t develop on what a brand new ‘partnership deal’ would entail.
Its two flagship vessels, Spirit of Adventure and Spirit of Discovery, run cruises across the British Isles, the Mediterranean, the Nordics and the Caribbean, with costs starting from £1,300 to £15,000.
Saga was reportedly in talks to promote its underwriting enterprise final yr to Open, an Australian insurer, however the deal didn’t recover from the road. The motor insurance coverage arm has suffered in an period of excessive inflation, in the end pushing up the value of payouts.
Analysts at Peel Hunt this week mentioned that the journey arm has ‘turned a nook’ however added that the corporate wanted to contemplate restructuring the insurance coverage enterprise.
Saga is anticipated to replace shareholders in a buying and selling assertion subsequent week.
This would be the first replace since Euan Sutherland stepped down as chief govt in November. He was changed by Mike Hazell, who was the group’s chief monetary officer.