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Monday, August 28 2000

Strike at BIW
The largest labor union at Bath Iron Works is on strike this morning.

The Portland Press Herald reports that members of Local S6 of the International Association of Machinists and Aerospace Workers voted 85.5 percent to 14.5 percent to authorize a strike Sunday. "Feeling angry and betrayed after one raise in six years," says the newspaper, "they rejected the company's latest contract offer by 88 percent."

Shipyard officials told the newspaper they were surprised that workers voted to strike ­ and that the vote was so lopsided.

"That is powerful," Susan Pierter, a company spokeswoman, said Sunday. "That's why we need to get back to the table."

For details of the proposed contract click here

Pierter reportedly said the company believed the contract proposal "was a very good offer and keeps our shipbuilders the best-paid shipbuilders in the country," but that "we obviously have some unresolved issues and we're preparing to go back to the table to discuss those issues."

The strike is the company's firstsince a 99-day walkout in 1985.

A BIW full-page advertisement in the Maine Sunday Telegram said : "The best shipbuilders in the world deserve the best pay and benefits in the industry," and "At BIW, that's exactly what they have."

The ad said shipbuilders earn an average of $41,000 a year in pay and benefits, and that figure would increase to $48,000 after three years of the new contract.

Carnival to buy rest of Costa
Carnival Corporation has signed an agreement to purchase the remaining 50% interest in Costa Crociere from Britain's Airtours plc.

Carnival and Airtours jointly acquired Costa in 1997 and with the purchase of Airtours' 50 percent interest, Carnival will own 100 percent of the Italian cruise operator. Carnival will maintain its 26% stake in Airtours which was acquired in 1996.

The cost of the Costa transaction will be £350 million. (approximately $525 million U.S. at current exchange rates).

"The purchase of Airtours' 50 percent interest in Costa is a very important strategic move in the continued development of Carnival Corporation's European business," said Micky Arison, Carnival Corporation chairman and CEO. "Costa is the largest and most successful cruise operator in Europe and will serve as Carnival's primary platform for expanding our presence in this increasingly important market."

Arison added that the purchase will also allow Carnival, the world's largest cruise line, to further explore and optimize marketing and operating synergies with Costa and to move more quickly to expand Costa's newbuilding program to take advantage of the fast-growing European market.

Carnival expects to pay cash for the transaction. Based on Costa's projected 2000 earnings, the transaction is not expected to be dilutive to Carnival's earnings per share.

Credit Suisse First Boston acted as financial advisor to Carnival Corporation.

Costa Crociere has a fleet of seven ships offering cruises of seven nights and longer throughout the Mediterranean, Northern Europe, South America and Caribbean. Earlier this summer, Costa launched the 86,000-ton Costa Atlantica, which has earned accolades from the European travel community for its innovative design concepts, impressive art collection and exquisite dining opportunities. Just last week, Costa contracted for a sister vessel slated to debut in summer 2003.

Carnival cancels two cruises for
Azipod preventative maintenance

Carnival Cruise Lines, will cancel two seven-day voyages of its cruise ship Elation departing Oct. 29 and Nov. 5, 2000, to perform preventative maintenance on the ship's two Azipod propulsion units. As a result, the company estimates that fourth quarter 2000 earnings will be reduced by approximately one cent per share.

The Elation, which sails every Sunday from Los Angeles to the Mexican Riviera, is one of two ships in the Carnival Cruise Lines fleet that features Azipod propulsion. The other vessel, Paradise, experienced a problem with the system in July, which forced the cancellation of five week-long cruises while the ship underwent repairs.

"Based on what we've learned during the course of repairing the Paradise, we feel it is prudent to take this precautionary measure on the Elation now to ensure we do not experience a similar problem on that ship in the future," said Bob Dickinson, Carnival president. "We are timing this in a manner that provides our guests with more than two months' notice of the cancellations so that they will have ample time to make alternative vacation plans."

 

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