Royal Caribbean Cruises Ltd has agreed to acquire a 50% stake in all-inclusive resort operator Sandals Resorts International for $3 billion, valuing the company at $6 billion, the cruise giant announced Wednesday.
This marks the largest transaction in the company's history and signals a strategic pivot to expand its footprint from the high seas into the land-based vacation market. Under the terms of the deal, Royal Caribbean will hold half of a newly established joint venture that controls Sandals' operations, while certain members of the Stewart family will retain the remaining controlling interest. The transaction is expected to close in early 2027.
Shares of Royal Caribbean fell 6.1% in Wednesday's trading session following the announcement. Chief Executive Jason Liberty described the partnership with Sandals as a "significant next step" in the company's broader ambition to build a comprehensive vacation platform, adding that it "brings together two iconic and leading vacation companies to further strengthen and grow one of the world's most admired resort portfolios."
Where the leadership sits
Liberty and Adam Stewart will jointly oversee the joint venture's board. Adam Stewart, son of Sandals founder Gordon "Butch" Stewart, stepped into the role of executive chairman after his father's passing in 2021. Sandals operates 20 beachfront properties across Caribbean destinations including St. Vincent, St. Lucia, and Barbados, positioning itself as a romantic getaway for couples by offering double-occupancy bookings only. The company also runs the family-oriented brand Beaches Resorts and stands as the largest private employer in the Caribbean region.
A long winding road to a sale
The deal brings closure to a protracted and intermittent sale process spanning several years. Following the founder's death, disputes over the trust governance structure triggered legal battles within the Stewart family. Over the past decade, Sandals had launched multiple sale attempts that all fell through. Just last year, the company engaged bankers to oversee a fresh sale process, which attracted interest from both strategic buyers and private equity groups.
Bank of America and PJT Partners served as financial advisors to Sandals, with Latham & Watkins and Jones Day providing legal counsel. Perella Weinberg, Morgan Stanley, and Kirkland & Ellis advised Royal Caribbean on the deal.
Building a broader vacation empire
Under Liberty's leadership, Royal Caribbean has emerged from the pandemic-era industry downturn as a heavyweight in the cruise sector, now commanding a market capitalization of $62 billion—far outpacing U.S. rivals Carnival Corporation and Norwegian Cruise Line Holdings Ltd. The company operates a fleet of 71 ships and owns private island resorts, including Perfect Day at CocoCay in the Bahamas. Liberty has been driving expansion into river cruises and travel packages, with his previous major acquisition being the $1 billion purchase of a majority stake in luxury line Silversea in 2018.
The broader cruise industry has lagged the broader market this year, weighed down by demand concerns linked to instability in Iran and regional tensions. In its second-quarter earnings report in July, Royal Caribbean trimmed its full-year revenue growth forecast to 9% from an earlier projection of 10%, citing currency fluctuations. The company's stock has declined 17% year-to-date.