What's next for Azamara after Royal Caribbean offloads its luxury line?

This time last year cruise ships were casting off on the world’s oceans blissfully unaware of the havoc that was about to befall the entire industry. Since then, the Cruise & Maritime Voyages fleet (a favourite among British passengers), along with several ships from Carnival Corporation brands, have been reduced to scrap metal.

But the announcement of Azamara’s sale by the Royal Caribbean Group to a venture capitalist is in a different league – and stunned even the most cynical pundits.

In 2007, Azamara Cruises rose like a phoenix out of the ashes of Renaissance Cruises, which collapsed following the September 11 attacks. Two ships from this former trailblazing but overleveraged company were purchased by Royal Caribbean Cruises Ltd and slated to sail under the Celebrity Cruises umbrella. However, it became evident that this duo of 690-passenger vessels could offer a more personalised, boutique-style cruise experience than the larger ships in the Celebrity Cruises flotilla. To differentiate the brand, the name Azamara was hatched: ‘Aza’ representing blue, and ‘Mar’ meaning sea.

The company struggled to attract a following of new clients, let alone those who might consider trading-up from the ‘modern luxury’ lifestyle so well honed by Celebrity Cruises. All that changed in 2009 when cruise industry guru Larry Pimentel was appointed president and chief executive, and the name was changed to Azamara Club Cruises to underscore the intimacy of the ships.

He was responsible for the strategic direction of the brand and ensured its growth and success. Radically remastered, Azamara Journey and Azamara Quest offered a wealth of value-added elements that passengers appreciated; and, in 2018, a third, identical ship, Azamara Pursuit, joined the fleet following a bow-to-stern makeover.

The company became renowned for thinking outside the box when it came to its unique selling point: “Destination Immersion”. With an increased demand for culturally enriching experiences, Azamara provided travellers with unique opportunities to experience destinations, never more so than during their “AzAmazing Evenings”. With overnight stays and visits to smaller, less-travelled ports, Azamara ensured their guests could venture beyond the flimflam of a destination.

Perhaps not surprisingly, Azamara became a popular choice with British cruisers who knew a good deal when they saw one. Almost unique in the “upper premium” segment of cruising, Azamara became renowned for its onboard country-club lifestyle, where attentive service and notable cuisine marked this niche cruise company out for the cognoscenti. To hurry a cruise with Azamara would be to miss the point.

When news broke last week that the Royal Caribbean Group had entered into a definitive agreement to sell Azamara to Sycamore Partners, a new chapter for this company that sets its own agenda with impunity has begun. The deal is described as an all-cash carve-out transaction worth $201 million. As a point of reference, the five ships of the CMV fleet sold at auction for just $23 million.

Obviously Sycamore Partners, who are a private equity firm specialising in consumer, retail and distribution investments, have exciting plans to retain Azamara as a going concern and any thoughts of scrapping the vessels are far from their operational plans.

Carol Cabezas, who has been the chief operating officer at Azamara for the past three years and was recently appointed to the role of president of the new company, said: "“We’re focused on expanding our fleet, because that’s the kind of exciting thing for our travel advisors and for our guests to think about; more options, more things to do. And it excites our team too. So that’s absolutely the path that we’re on.”

James Cole, founder of Panache Cruises, told Telegraph Travel: “I wasn’t hugely surprised by the sale of Azamara. After the seismic shock that’s reverberated throughout the cruise industry over the past 10 months little surprises me.

“It would be a shrewd move if Sycamore Partners retain the loyal Azamara personnel as well as the concept of 'Destination Immersion', which is massively popular with our clients.

"I hope the new owners enhance this element of their unique product.”

The River Clyde has been home to the Azamara trio for over nine months, when the time comes for them to sail away at least their fate won’t be an ignominious demise at a foreign scrap yard.

Venture capitalists have a nose for sniffing out an astute business proposition. But nobody could have expected Sycamore Partners to announce the acquisition of a fourth identical ship before the ink was dry on the original agreement. The additional ship will expand the fleet’s overall capacity by 33 percent.

It was only three days ago that Princess Cruises disclosed that Pacific Princess had been sold to an undisclosed buyer, now confirmed to be Azamara. Azamara Journey, Azamara Quest and Azamara Pursuit, as well as the former Pacific Princess, were part of the Renaissance Cruises’ fleet of virtually-identical vessels that traded between 1989 and 2001.

“The addition of this ship is an important milestone and reflects Sycamore Partners’ commitment to supporting Azamara in its next phase of growth,” said Stefan Kaluzny, managing director of Sycamore Partners.

“Expanding the fleet will allow Azamara to continue to serve loyal customers, as well as those new to the brand, with more unique 'Destination Immersion' programming and itineraries.”