Silver-haired specialist Saga scope out sale of stake in cruise business
Over 50s specialist Saga is mulling the sale of a stake in its cruise business in a bid to “optimise” the firm as it struggles under a hefty pile of debt.
In a statement to the London Stock Exchange this morning, London-listed Saga said it is “exploring opportunities to optimise [its] operational and strategic position in Cruise” where it was currently operating at “close to capacity”.
“[The board] has concluded that a partnership arrangement for Ocean Cruise would be consistent with group strategy to move to a capital-light business model to support further growth and crystalise value, reduce debt and enhance long-term returns for shareholders,” the firm said.
“No decision has yet been made and there can be no certainty that any partnership agreement will occur.”
An announcement on the arrangement would be made in “due course”, the firm said.
Sky News reported last night that the firm was mulling the sale of its two flagship ocean cruise liners and potentially selling off the whole division under a licensing arrangement. Such a deal could see the firm outsource the operation to an external firm under its own brand.
The move comes as Saga struggles under a heavy debt pile which had reached £650m at its interim results in September.
Saga, which offers insurance and holidays to over 50s, has been looking to simplify its business in recent years and previously looked to sell its underwriting business to an Australian firm in a deal which fell apart.
Shares in the firm bounced beyond nine per cent today but have slumped over 89 per cent in the past five years, leaving it with a market capitalisation of around £226m.