Completion of acquisition

Despite all the arguments posed by the parties are denied, on July 24, 2002, the commission delivered a final conclusion that the acquisition between Carnival Corporation and P&O Princess plc will not cause competition in the common market to be disturbed. The conclusion is mainly based on the Commission’s calculation that combined national market share between the parties in each country of the customer would not exceed 60 %. The worldwide share of the market owned by the parties (by customer count) in the year 2000 would combine to be only 32% (Carnival 19% and POPC 13%).
Post-Acquisition Consolidated Performance

Market Share By July 8, 2004, the company has created a record among the cruise industry. The combined enterprises owned 77 ships operating under 12 cruise brands. The Miami based company has now 47% of the world’s cruise operator market share. Timothy Conder, a business analyst, believes that the cruise industry remains in its infant stages, accounting for only 2 % of global tourism. Only 16% of North Americans (averagely 70 % of the world’s cruise market) and less than 1% of Europeans (20% of the world’s cruise market) have ever taken a cruise, which indicates a significantly wide room for growth. The company has built 11 ships during 2003 only.
Financial Performance Having trough some of its worst in the previous 5 years, in 2004, the company, after a year since its acquisition of the P&O Princess Cruise displayed tremendous financial performance. The company displayed $332 million of net income and 41 cents earnings per share (which was 6 cents above analysts’ estimates. The net Revenue yields grew 13. 2% on an increase in capacity, which indicated strong pricing power. These results were considered amazing due to the rising oil price and global violence wasn’t enough to eliminate profit. Carnival’s stock jumped 128% from $20. 60 in mid-2003 to $47 on July 7 as the tickets sold leaped 48% to $7. 4 billion and non-ticket revenue jumped 50% to 2. 1 billion. Below is Carnival’s 3 years restated summary of income statements. In two years, its sales, operating income, and net income were practically doubled, its stockholder’s related ratios also show a significant increase compared to last year. The financial statement displayed that the company has obviously recovered from its previously declining performance trend. The year 2004 alone reflected that the acquisition of Carnival plc, have impacted in the most positive way for the company’s performance. Despite the issues of increasing oil price and global insecurity, the company achieved amazing results unpredicted even by analysts.
The current and Debt/Equity ratio shows that the company’s recent proportion of short/long term debt to assets is a lot more preferable to build stockholders’ and creditors’ confidence. IV. Conclusion Mergers and acquisitions have been companies’ tools of development. After achieving a certain level of growth, a company starts to think about a merger with its rivals or acquiring its vertically related parties. The overall purpose of the activity is to make one’s business stronger or just to gain the company’s share of the market. Carnival and Princess are some of the most famous acquisitions in decades. Both separate companies suffered from factors beyond their control and displayed an immensely declining trend of performance. But performance reports in a year’s time since the acquisition elaborated that the combination of the two, resulted in an amazing increase of consolidated company performance. Some believe that the amazing achievement was due to strong market demand and some thought that it was due to the infant nature of the industry. But there are some who believe that it was carnival’s structure of good corporate governance that delivered success to the merger. International acquisitions are known to be sources of corporate governance complications for decades. Without a strong and open for improvement structure of corporate governance, the abundant benefits of the acquisition written on paper would be rather illusions and fictions.

Reference

Ayer, Sanjay. 2005. “Carnival PLC ADR vs. Carnival Corp”. Morningstar [online]. Retrieved May 9, 2005, available at http://morningstar.aol.com/PoweredBy/doc/news/1,3496,128105,00.html? CN=NSC124 “Carnival”. 2005.
http://www.businessweek.com/bw50/2005/company/CCL.htm “Carnival CCL”. 2005.
http://quicktake.morningstar.com/Stock/search ‘Commission Decision’. 2003.

Order a unique copy of this paper
(550 words)

Approximate price: $22

Basic features
  • Free title page and bibliography
  • Unlimited revisions
  • Plagiarism-free guarantee
  • Money-back guarantee
  • 24/7 support
On-demand options
  • Writer’s samples
  • Part-by-part delivery
  • Overnight delivery
  • Copies of used sources
  • Expert Proofreading
Paper format
  • 275 words per page
  • 12 pt Arial/Times New Roman
  • Double line spacing
  • Any citation style (APA, MLA, Chicago/Turabian, Harvard)

Our guarantees

At Solution Essays, we are determined to deliver high-quality papers to our clients at a fair price. To ensure this happens effectively, we have developed 5 beneficial guarantees. This guarantees will ensure you enjoy using our website which is secure and easy to use.

Money-back guarantee

Most companies do not offer a money-back guarantee but with Solution Essays, it’s either a quality paper or your money back. Our customers are assured of high-quality papers and thus there are very rare cases of refund requests due to quality concern.

Read more

Zero-plagiarism guarantee

All our papers are written from scratch and according to your specific paper instructions. This minimizes any chance of plagiarism. The papers are also passed through a plagiarism-detecting software thus ruling out any chance of plagiarism.

Read more

Free-revision policy

We offer free revisions in all orders delivered as long as there is no alteration in the initial order instruction. We will revise your paper until you are fully satisfied with the order delivered to you.

Read more

Privacy policy

All data on our website is stored as per international data protection rules. This ensures that any personal data you share with us is stored safely. We never share your personal data with third parties without your consent.

Read more

Fair-cooperation guarantee

Ordering and sending money to us is an indication that you are purchasing our products and services. To have business talks laid out in the official language, you can check on our terms and conditions and get more information about this.

Read more

Calculate the price of your order

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
$26
The price is based on these factors:
Academic level
Number of pages
Urgency
Order your essay today and save 30% with the discount code: LEMONADEPlace Order