P&O Princess Merger Update

April 11, 2002
While simmering quietly since February, antitrust-related investigations into the proposed P&O Princess - Royal Caribbean merger and the Carnival Corp. acquisition of P&O Princess, have begun boiling again. The latest newsmaker is the European Union Commission, which today rebuffed the United Kingdom’s request to refer the Carnival/P&O deal to a review by its own competition authority. Instead, the EU Commission has decided to undertake the review via its own comprehensive four-month investigation. In a statement, a spokesperson from the E. U. Commission said, "There are serious concerns, particularly in relation to the parties' strong position in the cruise sector in the U.K., Germany and possibly other European countries." This move is widely perceived as a disappointment on the Carnival Corp. side as it had hoped that a speedy “ok” from the EU would have a positive influence on investors. In response to the news, Carnival has issued a statement: “Carnival remains fully committed to completing its combination with P&O Princess and will continue to co-operate fully with the European Commission and the FTC with a view to securing a successful outcome.” All cruise lines involved are still waiting on rulings from the two key regulatory agencies -- America’s Federal Trade Commission and the United Kingdom’s competition authority -- which are anticipated to be released sometime this summer, though the FTC, for one, will not comment on a specific date of announcement.