Carnival sees more poison in pill

THE poison pill in P&O Princess' European joint venture with Royal Caribbean could be double the $200m (£140m) first thought, takeover suitor Carnival Corp said today.

Carnival said that was because Royal Caribbean's loan notes were worth significantly less in the market than their face value stated.

Royal Caribbean will use the notes to buy Princess out of the $2bn venture if Princess is taken over by Carnival.

A Carnival spokesman said documents relating to Princess' planned $7bn merger with Royal Caribbean revealed the change of control provisions regarding the poison pill could be triggered by a range of events, including the appointment of new directors at Princess.

The $400m fee is on top of the $62.5m to be paid if Princess broke off the Royal Caribbean merger.

Carnival hopes to end that proposal with a £3.2bn hostile bid for Princess and is expected to outline its case in a letter to Princess shareholders next week. It believes the terms of the Princess-Royal merger allow it to delay a shareholder vote on the deal from 14 February until 16 November.

Carnival will also tell Princess shareholders it told the company about its takeover plan on 24 September, more than a fortnight before Princess entered exclusivity talks with Royal.