Possible Results of Princess Merger

March 8, 2002

After several months of high-wire tension, the “royal” triangle between P&O Princess-Royal Caribbean and P&O Princess-Carnival is, for the moment, in quiet mode as the companies involved begin the long haul toward obtaining regulatory approval. Don’t expect a quick resolution, either. “The situation is that the proposed merger is in the regulatory review channel and it will take some time to come out,” says Jack Williams, Royal Caribbean/Celebrity president and chief operating officer. Even he’s not saying how long it could take for, in particular, the United States Federal Trade Commission to rule on either the P&O Princess/Royal Caribbean merger -- or P&O Princess’ acquisition by Carnival.
In the meantime, Williams wants to clarify the future for his two cruise lines should the merger ultimately win out over the Carnival takeover. Biggest issue? The fate of Celebrity Cruises, victim of much whispering -- by pundits and passengers alike -- over the past two months.
“The most important takeaway for the consumer,” Williams says, is “each of the operating units will continue to operate as separate brands, what they offer today. The major benefit is to provide a situation to improve our economies. When you are able to do that you are able to improve the product.” Adds Williams, “they’ll all operate as independent brands. I can’t be any clearer than to emphasize they will continue to operate separately and independently as they are today. Celebrity will continue as it is today. Absolutely.”
Beyond that, details about changes in the cruise experience as the result of a merger are scarce as he points out -- naturally -- that the companies themselves haven’t divulged too much to each other. “We’re still competitors, we can’t even talk to Princess about that,” says Williams. “It’s way too early to talk about that.”
Indeed. A spokesman for the Federal Trade Commission warns that the process of regulatory approval could take a while due to the fact that three major players in the cruise industry are involved. While declining to provide a time line, he does admit that the more complicated the situation the longer it takes.