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Carnival Re-Enters Norway Bidding

January 27, 2000

OSLO, Norway (AP) _ The bidding war over the Norwegian Cruise Lines flared up again Thursday with industry leader Carnival Cruise Lines saying it was ready to beat rival Star Cruises’ offer, the Norwegian company announced.

Last month, Asia’s leading cruise ship company, Star, appeared to have secured control of the line with just over 50 percent of the shares in Norwegian Cruise Lines owners, Oslo-based NCL Holding. It bid $4.38 per share.

But NCL had already agreed with lenders to convert $62 million in debt into stock in the company, which increased the total number of shares and left Star owning only about 47 percent.

Carnival had started the bidding contest by offering $3.75 for each NCL share but withdrew following Star’s December bid.

On Thursday the NCL board informed the Oslo Stock Exchange that Carnival was planning a new offer of $5 per share. The offer will be contingent upon it acquiring half the shares in NCL, and winning approval by U.S. antitrust officials.

That would put the total stock value of NCL at about $1.3 billion.

Malaysia-based Star is Asia’s largest cruise line. NCL is the world’s fourth largest, with 9 percent of the market. It is based in Miami, although it is Norwegian-owned.

Miami-based Carnival is the largest, with 36 percent of the world market through its Carnival, Holland America, Cunard and Seabourn lines.

In a statement to the stock exchange, NCL said it had recommended that its shareholders refuse Star’s offer.

After Star’s bid, major owners in NCL made a play to drive up the price by getting a Norwegian investor, Christian Sveaas, to buy its shares for $4.62 each. In exchange, he got an option to buy 30 million NCL shares for $4.37 each.

NCL’s board has said its goal is to get the best possible price for the Norwegian line.

Trygve Hegnar, a major NCL shareholder, said in an interview with the Norwegian radio network NRK that he did not exclude the possibility of an even higher bid for the line.

``Now that Carnival has said it is willing to buy the company, we can’t exclude others entering the field, or Star raising its bid,″ he said.

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