Airtours seals pounds 168m Costa deal

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The Independent Online
Airtours' already close relationship with its largest shareholder, Carnival Corporation, intensified yesterday after the two companies put the finishing touches to their first joint purchase, the pounds 168m acquisition of Costa Crociere, Europe's leading passenger cruise operator.

Airtours' shares closed 11p higher at pounds 10.09p after the deal, first announced last December, was confirmed.The shares have more than doubled since last summer, partly on the back of strong trading figures but largely because of increasing speculation that Carnival, which holds 29.5 per cent of Airtours' shares, is poised to make a bid for the rest of the company. City gossip has put a price of more than pounds 12 on any successful bid.

Airtours and Carnival are paying pounds 168m for Costa, pounds 13m less than the price announced in December when Costa's Milan-traded shares were suspended ahead of final negotiations with a syndicate that controls 56.9 per cent.

The cut reflects the strength of sterling so far this year, making Airtours one of the few beneficiaries of the soaring pound.

Having secured the agreement of the syndicate, including the Costa family itself speaking for 30.7 per cent of the shares, Airtours and Carnival are confident of reaching the 90 per cent acceptance level on which the acquisition depends. The deal is also dependent on EU regulatory approval. If successful, Airtours will secure Costa's eight cruise ships which spend the summers in the Mediterranean and northern Europe, before sailing to the Caribbean and South America for the winter season. Costa, based in Genoa made profits before tax in 1995 of pounds 16.8m on pounds 352m turnover.

In 1995 about 900,000 cruises were taken in the Mediterranean and northern Europe out of a global total of 5.4 million.