Sun Cruises in its statement said there were 472 passengers and 632 crew members on board the Sun Vista when she caught fire in her engine room and then sunk.
Passengers reported that the ship was on fire for hours, with the captain coming on to say things were ok over and over, until he finally admitted defeat about 5:30pm and came on to say they were going to abandon ship.
The evacuation was far from smooth with lifeboats overloaded, some double their capacity.
There were reports of lifeboat engines not working, and passengers unable to row using oars due to choppy seas pushing them back.
Passengers say some were sick in the lifeboats, some only in bathing suits as they were in the pool when the evacuation order was given, many were barefoot. Lifeboats bobbed in the water for five hours in a major shipping lane, in the Malacca Strait, before rescue ships began to hoist them aboard.
Sun Vista was on a six-day cruise from Singapore to the Malaysian ports of Malacca and Penang, then the Thai resort island of Phuket.
Ten passengers were sent to Penang Hospital for treatment. A hospital spokesman said the conditions were not yet known.
Sun Cruises said all passengers would be accommodated at hotels until they could be flown home. They would be given full refunds "for the inconvenience."
Rescued passengers included Australians, Americans, Britons and Japanese. Some in Penang spoke of panic and chaos.
Thomas Bonnard, from the UK, said the ship's captain did not tell the passengers about the fire and he said crew members were "panicky".
"Then he came out again at about 5.30pm and said the fire was more serious and we were going to have to abandon ship."
Peter Andrews, 76, from Rayleigh, Essex, said: "My lifeboat was overloaded, there were 76 people in when the capacity was 45 and the person responsible for it didn't seem to be very confident."