Royal Caribbean Pays $3 Billion to Capture More Vacation Spend

Royal Caribbean Group is paying roughly $3 billion for a 50 percent stake in Sandals and Beaches Resorts — about 10 times forward EBITDA — and CEO Jason Liberty says the math is simple: the cruise giant currently captures only 20 to 25 percent of its guests' annual vacation spend.

"Our strategy is to turn the vacation of a lifetime into a lifetime of vacations," Liberty said on the company's third-quarter earnings call on Tuesday. That means keeping guests inside Royal Caribbean's ecosystem whether they cruise, stay at an all-inclusive, or eventually do something else entirely.

The deal, expected to close in early 2027, will be accounted for as an equity method investment on a one-quarter lag. Liberty said it should be immediately accretive to earnings while keeping the company within its leverage targets. Immediate accretion at 10x forward EBITDA is a confident claim; buyers paying premium multiples usually need years, not quarters, to prove it.

Why all-inclusive, why now?

The customer overlap is already real. About 30 percent of Royal Caribbean guests have stayed at a Caribbean all-inclusive resort in the last two years — spend the company is currently losing to competitors. "Today, if a Royal Caribbean customer goes on a competitive cruise brand, I think that's a fail," Liberty said, extending the same logic to river cruising and now resorts.

The portfolio brings 18 resorts plus more than 1,000 acres of undeveloped Caribbean real estate, much of it adjacent to existing properties. CFO Naftali Holtz said the land was included in the purchase price and offers several greenfield opportunities in attractive markets.

Development is already mapped: three new resorts plus room expansions across the portfolio, funded by the resort business's own cash flow rather than Royal Caribbean's balance sheet. "This is not stuff that you can just go buy off the shelf," Liberty said, crediting the Stewart family for curating the land.

What won't change?

Don't expect cruise ships calling at Sandals properties. Liberty dismissed that speculation outright. "Sandals needs to be Sandals. Beaches needs to be Beaches," he said.

What Royal Caribbean brings instead is back-office muscle: revenue management, loyalty, data, distribution and purchasing scale. Loyalty benefits would flow in both directions, so a cruise regular could see resort perks and vice versa. Liberty estimated several hundred million dollars of synergy opportunities over time, split across revenue and cost sides — an estimate, not a booked figure, and one worth watching against actual results after closing.

On expansion beyond the Caribbean, Liberty said the brands have legs globally, but the near-term focus stays on growing the Caribbean footprint. In plain terms: this is a Caribbean wallet-share play first, a global ambition second, and a bet that undeveloped beachfront — which nobody can manufacture anymore — is the asset that keeps competitors locked out for decades.