Home > > OTA seeks $1.2 billion loan, tourism slowdown spreads in Asia | Daily Brief

OTA seeks $1.2 billion loan, tourism slowdown spreads in Asia | Daily Brief

02/15/2020| 12:54:56 AM| ChinaTravelNews

Travel advisers projected 10%-15% off in the $45.6 billion global cruise industry, major Chinese park operator warned of epidemic impact on $320 million asset-backed notes.

Key developments:

* Online travel giant to raise $1.2B
* Tourism slowdown spreads across Asia
* MGM Resorts drops forecast, blames virus
* $45-billion cruise business challenged 

Worldwide updates:

Trip.com seeks $1.2 billion loan

>> Trip.com Group is seeking to raise a $1.2 billion loan in a test of investor risk appetite. The loan is for refinancing and working capital.

It comes amid challenges to its business following the new coronavirus that has claimed over 1,300 lives. More than 50 countries or territories have imposed travel restrictions and tightened visa requirements to contain the spread of the disease.

Park operator warns of cashflow woes

>> Slender West Lake Tourism, a Chinese national park operator, risks becoming the first high-profile victim of the coronavirus outbreak in China’s nascent asset-backed securities market, warning against a weakening ability to generate cashflows. It said the epidemic is having a negative impact on its 2.2 billion yuan ($320 million) asset-backed notes.

Tourism slowdown spreads across Asia

>> Airline bookings from across Asia Pacific excluding trips to and from China and Hong Kong were 10.5% lower for March and April in 2020 compared with last year, according to travel analytic company ForwardKeys. 

Outbound travel from Japanese and South Korean markets were the worst hit, with bookings to worldwide destinations down 17% for the next two months, compared with the same period in 2019.

MGM Resorts withdraws forecast, CEO steps down

>> MGM Resorts said CEO Jim Murren will step down and the U.S. casino operator withdrew its financial forecast for 2020, as it assesses how the coronavirus epidemic will impact operations.

$45-billion cruise business challenged 

>> Cruise companies have been reluctant to release any data about whether there has been any impact on bookings in the $45.6 billion global industry in the weeks since the virus outbreak, but some travel advisers say they are off by 10%-15%.

>> Carnival Corp. issued updated earnings guidance speculating on the impact of suspending its cruise operations in Asia until the end of April due to the COVID-19 virus. Its shares are down 14% since the beginning of 2020. 

>> The Cruise Lines International Association which represents around 90% of global cruise capacity says around 10 of its 272 member ships are currently in Asia. Only the Diamond Princess has confirmed cases of virus, the association said. Six of the 10 ships have canceled their itineraries for now, including Royal Caribbean’s Spectrum of the Seas and MSC’s Splendida.

United Airlines extends flight suspensions 

>> United Airlines is following the lead of fellow U.S. carriers Delta and American Airlines in suspending service to China through April amid the ongoing virus outbreak.

Interest in private jets surges

>> A drop in airline flights from China and Hong Kong due to the coronavirus is increasing demand for private jets as wealthy passengers try to get out, but travel bans and nervous crew have kept that from translating to more business.

But strict quarantine requirements, travel bans on Chinese citizens and concerns for crew safety have left only a limited pool of private jet operators willing to fly to China compared with the situation during the 2003 SARS epidemic.

TAGS: Trip.com | Slender West Lake Tourism | MGM Resorts | coronavirus | Daily Brief
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