Star Cruises continues to move fast and this week named Colin Veitch president and CEO of Norwegian Cruise Line (NCL), thus firing Geir Aune, who was also holding that position at press time. Aune could not be reached for comment.
But the battle for NCL may not be over. While Star at one point held 50.2 percent of the shares, its holding has been reduced to 47 percent though the exercise and sale of stock options by majority shareholders.
This is apparently an effort by some NCL shareholders – who also happen to be board members and members of management – and an outside investor, to either block Star’s take-over, or force Star to pay more than NOK 35 for the outstanding shares. There are also rumors that Carnival Corporation may be back in the bidding for NCL.
Meanwhile, Star has made its mandatory offer of NOK 35 for the balance of the shares and the ADRs (NOK 140).
At Star’s request, an extraordinary general meeting of NCL shareholders has been scheduled for February 4 to elect a new board of directors, and with 47 percent of the shares, Star will more than likely control the election.
Veitch was senior vice president of marketing and corporate development at Princess Cruises and also had the executive responsibility for Princess’ sister company in Australia, P&O Holidays. He has also been named to Star’s board.
Meanwhile, Colin Au, president and CEO of Star, said that “we believe only a local management team, familiar with its own market, can best run this business and we are committed to supporting the current organization in developing NCL’s potential.”
Au also said that Veitch will have Star’s full support and strong financial backing to grow the business with new ships and product innovations.
“As the Star/NCL group grows, we see the potential for synergies in a number of areas including ship building, ship operations and staff training, and cross marketing of our group’s various brands in North America, Europe and Asia-Pacific,” Au added.
According to sources, Star is asking for immediate control of NCL, participation in board meetings, and opportunity to observe the operation of the company. With one exception – the general meeting of shareholders – NCL’s present board has rejected all of Star’s requests.
Behind the Scenes
It is also no big surprise to learn that Star started to accumulate NCL shares at the beginning of December as soon as Carnival’s offer was made public. Star and NCL also had several meetings whereby they discussed how the two companies could best cooperate. According to Star, these talks did not result in any agreements, and, of course, instead Star acquired NCL.
According to reports, NCL had also previously declined to discuss an increased offer upwards of NOK 35 from Carnival.
With the recent-most moves in Norway, the question now becomes whether these are simply shareholders and an investor seeking to enrich themselves at Star’s expense, or whether majority shareholders and management are seeking to block what has turned out to be a very hostile takeover by Star. Or is Carnival back in the game, trying to out maneuver both NCL and Star?
If the takeover by Star gets to be too difficult or complicated, they may choose to pay more for the balance of the shares or even sell their shares to Carnival.
This has been a game from the very day Carnival made its offer public. Meanwhile, the rest of NCL’s management, shore-side and shipside employees are basically left out in the cold – waiting to see what will happen as the company continues its revolving-door management legacy.
