Why billionaires want to expand their horizons and buy cruise ship fleets
Although 70 per cent of thriving industry is controlled by Carnival and Royal Caribbean Cruises, niche markets are attracting wealthy entrepreneurs
It was a cold and cloudy July day in Reykjavik and French arts patron Maryvonne Pinault was at a pier fulfilling her duties as godmother for Le Laperouse, the first of six 184-passenger, upmarket expedition yachts owned by her husband’s Marseilles-based cruise line Compagnie du Ponant.
The French billionaire and Kering chairman Francois Pinault was not there to watch his wife smash a bottle of Champagne against the ship’s hull in the time-honoured nautical tradition.
Yet it was always going to be her ship more than his: buying the cruise company was Madame Pinault’s idea, after all.
In 2015, Pinault’s holding company, Groupe Artemis, acquired Ponant from Bridgepoint Capital for an undisclosed sum.
Now the cruise line, which reports annual revenues of about US$182 million, is part of a luxury portfolio that also includes Gucci, Christie’s auction house, and famed vineyard Château Latour.
The Pinaults, by extension, are joining a tight-knit community of billionaires in the cruise industry, ranging from newcomer Richard Branson to industry forefather Micky Arison and the self-made Norwegian upstart, Torstein Hagen.
In an industry very much dominated by top players – Carnival and Royal Caribbean Cruises control 70 per cent of the market – it is mostly niche segments, such as Ponant’s that are attracting wealthy entrepreneurs, Brian Egger, of Bloomberg Intelligence, says.
Despite barriers to entry such as the cost and time it takes to build new ships, he says the industry can be a “good bet”, especially if you are going after an underserved demographic.
The potential market is expansive.
At the age of 27, I was already dreaming of starting a cruise line despite never having been on a cruise. What I had seen and heard about cruises sounded quite dull, so I figured I’d start my own