S&P: Developing view for Oceania Cruises

Standard & Poor's said it revised its outlook on Oceania Cruises Inc. to developing from positive, and affirmed its B corporate credit rating.

The revision and affirmation follow Oceania's announcement Feb. 26 that it has formed a strategic partnership with Apollo Management LP, whereby Apollo will become the majority owner of Oceania. The transaction, valued at $850 million, including the assumption of debt, is expected to be completed in the second quarter of 2007, subject to various approvals, the agency said.

Oceania has not publicly disclosed full details about the effect of the transaction on its capital structure, but the agency said it expects the transaction will trigger a change-of-control event under its bank facilities, likely resulting in a refinancing. S&P said it has revised its outlook to developing until it can assess the pro forma capital structure. Still, S&P said it does not expect the transaction to result in a meaningful leveraging of Oceania's balance sheet.

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