Royal Caribbean Group has given itself some financial breathing room as it lays under billions of dollars of Covid-19 debt, but the bond refinancing will not come cheap.

The Jason Liberty-led owner of 64 cruise ships has upsized a $1bn private note offering that was announced on Monday to $1.25bn at a hefty coupon rate of 11.625%.

New York-listed Royal Caribbean has offered these notes, which will be offered on or around Thursday and will mature in August 2027, in an effort to make principal payments on 2020 debt maturing this year and in 2023.

Before paying off the bonds, New York-listed Royal Caribbean said it may temporarily use the proceeds from the note sale to pay back money borrowed from revolving credit facilities or other borrowings.

The new offering takes the Miami-based owner’s debt issuance to almost $2.5bn this month alone, as it faces $20bn in total debt that it has accumulated since early 2020 to remain afloat during the pandemic.

On 8 August, Royal Caribbean offered $1.15bn in convertible senior notes, with a 6% coupon rate, in a private offering after upsizing a private $1.04bn offer made on 1 August.

The company offered those notes, which will come due in 2025, so that it could repurchase $1.15bn in debt that matures next year.

That 2020-issued debt consists of $800m in convertible senior notes due in June 2023 with a 4.25% interest rate, and $350m in convertible senior notes due in November 2023 at a 2.88% coupon rate.

The company’s total debt stands at $20bn, while competitor Carnival Corp is wrestling with $35.1bn in debt and Norwegian Cruise Line Holdings has $13.6bn in debt.