Travel Weekly's Cruise E-Letter: February 12, 2002 February 12, 2002 Share 1 -- THE WEEK OF P&O PRINCESS' Feb. 14 shareholder vote in London on the proposed merger with Royal Caribbean is upon us. But who will be Princess' Valentine? Carnival Corp. said Friday the number of P&O Princess shareholders promising to vote to adjourn the meeting -- thereby tabling a vote until both proposals go through regulatory review -- now includes holders of more than 29% of the stock. THE PRINCESS board rejected Carnival's latest merger bid of $5.4 billion, a 5.9% increase over its Jan. 30 offer of $5.1 billion, saying the price is right for shareholders who want to "cash out" but not for those with long-term interests. "The combination with Royal Caribbean offers significant potential for further value creation," the line said, adding that it continues to question both Carnival's commitment to the deal and its claims that both proposals faced similar regulatory hurdles. During a subsequent conference call with analysts, P&O Princess said the assurances Carnival received from P&O Princess stockholders that they will vote to adjourn the Feb. 14 meeting were not legally binding.MEANWHILE, Royal Caribbean CEO Richard Fain, making his pitch to P&O Princess shareholders, said that adjourning the meeting and delaying a decision on the Royal Caribbean deal might "jeopardize" the merger. "It is not Royal Caribbean's style to make ultimatums," Fain said in a letter to shareholders. "The current disruption may not yet cause damage to our business, but that point is close at hand."TGIF? And what will Fain be doing the morning of Feb. 15? "Whatever happens, I'll be on the beach," the chief executive said. "Actually, I should say I'll be on a ship. I hope to be on a Princess ship."ISLAND CRUISES, a joint venture between Royal Caribbean Cruises Ltd. and U.K. tour operator First Choice, will shift its only ship -- and its marketing focus -- to the U.S. this winter. The original plan was to market the Island Escape, currently sailing as Royal Caribbean's Viking Serenade, exclusively to Europeans. The decision to base the ship in Los Angeles and sell to the U.S. market was made recently, but the news only leaked out last week. The company said it plans to begin selling the U.S. sailings -- which depart from Dec. 6 through March 31, 2003 -- in May.P&O PRINCESS CRUISES took time off from the merger brouhaha to report earnings of $16.4 million in the fourth quarter compared with a net loss of $3.6 million in 2000. Revenue for the quarter was $485.3 million, a hair better -- or at least $500,000 better -- than fourth-quarter 2000. P&O Princess attributed the dramatic year-over-year improvement to cost reduction programs and lower fuel prices in 2001, as well as a $6 million charge in 2000 due to the disposal of the ship the Victoria. Bookings for P&O Princess' European and Australian divisions also were less affected by Sept. 11, the company said. North America occupancy levels held steady at 98.2% in the fourth quarter compared with 98.1% in 2000. For the year, the cruise line reported a profit of $286.3 million on revenue of $2.45 billion.CARNIVAL CRUISE LINES is offering a series of "Quit Smoking Caribbean Cruises," where passengers attend a variety of clinics conducted by the American Lung Assn. of Connecticut, develop their own "quitting plan" and learn how to fight off impending nicotine fits. The cruises are aboard Carnival's smoke-free ship, the Paradise, so cheaters can't even bum a smoke off an unsuspecting shipmate.