Travel Weekly's Cruise E-Letter: January 14, 2003

OPTIONS TO BUILD two 2,100-passenger ships for Royal Caribbean Int'l have again been put on hold. The two options for Radiance-class vessels, with German shipyard Meyer Werft, were extended to Sept. 19; both were to expire Jan. 10. The extension marks the fourth time these options have been deferred since their original expiration date of June 27, 2001, one financial analyst noted.

NAME OF THE GAME: The Insignia is the new name of the second cruise ship that will be operated by Oceana Cruises, a new cruise line headed by cruise veterans Frank Del Rio and Joe Watters. But sources told TravelWeekly.com the cruise line itself may take a new name to avoid confusion over a P&O Cruises ship, also called the Oceana. Oceania Cruises could be the new brand name, sources said, although nothing official has been announced from Oceana. The Insignia, formerly Renaissance Cruises' R2, will sail its maiden voyage Oct. 4 from Barcelona to Istanbul. Oceana's other ship, the Regatta, will sail from Barcelona July 5. Oceana formally opened its Miami headquarters last week; reservations begin Jan. 27.

VACATION.COM made a deal to take $1 million in risk inventory on Norwegian Cruise Line's Norwegian Dawn for 300 cabins on the ship's sailings out of New York during a two- month period this summer. Vacation.com takes the risk and members can sell the cabins with a 20% commission--or if they need to, they can share commissions with clients. Senior vp-sales and marketing Andy Stuart said Vacation.com approached the line after Carlson Wagonlit struck a similar deal with the line. "We are interested in deals like this," he said.

P&O PRINCESS CRUISES formally accepted Carnival Corp.'s $5.3 billion merger offer Jan. 8 and will recommend that its shareholders approve the deal at a shareholder meeting, likely to be held in late March. P&O Princess will change its corporate name to Carnival (UK) if shareholders accept the offer, although the brand names Princess Cruises and P&O Cruises will not change, executives said. The combination of the world's largest and third-largest cruise companies will create a cruise operation with 99,964 berths, plus 42,260 lower berths scheduled to be added over the next three-and-a-half years, according to P&O Princess.

THE MERGER takes the form of a dual-listed company, under which the two firms remain separate legal entities, each with its own board of directors and senior management. But Carnival and Carnival (UK) will be jointly operated, and a single, senior-executive management team will manage the combined group. It will be headed by Carnival Corp. chairman Micky Arison. Peter Ratcliffe, P&O Princess' CEO, will be an executive director along with heads of Carnival's other cruise brands.

MEANWHILE, the merger is subject to a second review by the European Commission; cruise executives said the review was a "formality" and they expect clearance within 30 days. The lines also will submit merger documentation to the Securities and Exchange Commission for a review that is expected to take about 60 days, a Carnival spokesman said.

TRAVEL AGENTS and their clients will start seeing the phrase "Gold Anchor Service" around Royal Caribbean Int'l ships. The plan is to emphasize Royal Caribbean's onboard staff and service, senior vp-sales and marketing Dan Hanrahan told TravelWeekly.com. "Agents are always saying, give me a reason to sell," he said. "What gets lost in the conversation is the service."

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