P&O Princess Cruises plc and Royal Caribbean Cruises Ltd have said they plan to merge to create the world's largest cruise group and cut costs to help them sail the choppy waters of the tourism sector.
The deal values Royal Caribbean at a small premium of around two per cent - or about 34 US cents per share. Each Royal Caribbean share will be equivalent to approximately 3.46 shares in P&O Princess. The merged group, which aims to challenge market leader Carnival Corp and will have a market value of about $6 billion, expects annual savings of over $100 million. P&O Princess said its shareholders would own 50.7 per cent of the enlarged group, which will be headquartered in Miami, Florida. Royal Caribbean will hold 49.3 per cent.