P&O and the Rise of Air Travel
Rivalry from air travel resulted in the withdrawal of steady liner passenger services, with the concluding, scheduled journey to the Far East occurring in 1969. Passenger business now comprised of the cruises and ferry service. In 1974, P&O purchased Princess Cruises which then established the keystone of P&O’s wide-ranging business, enhanced by the 1988 acquisition of Sitmer Cruises. Lord Inchape succeeded as chief executive in 1978 and began further restructuring. This involved the taking apart of the energy division, sale of all interests in the North Sea and the US oil and gas industry purchased in the 1960s, and a minimized function for general cargo and the bulk division. Between 1974 and 1980, the quantity of ships in the company’s fleet declined from 178 to 89. Due to the launching of much bigger ships, however, the sum tonnage declined by just 3 to 4 percent, positioned at .45 million grt in 1981.
Sometime at the end of the 1970s Lord Inchcape was looking for fresh contenders for the board. Ultimately, he decided that Jeffrey Sterling, a City financier who had developed his own group of companies rooted in the Sterling Guarantee Trust, would be the best one. In 1980, Sterling entered the board. Almost immediately an aggressive bid for the company was obtained from Trafalgar House, the owner of Cunard and also a rival in the construction business. The bid was known as the Monopolies and Mergers Commission, which enabled it to carry on in 1984. Jeffrey Sterling succeeded as chairman in 1983, and the intermission gave him opportunity to plan P&O’s defense-the renewal of the bid did not pull through.
In 1985 P&O joined with Sterling’s Sterling Guarantee Trust. This agreement resulted in several nonshipping interests, including the ownership and operation of the Earls Court and Olympia exhibition centers, Town and Country Properties, Sterling Guards (security company), Buck & Hickman (maker and distributor of tools) and Sutcliffes (catering company). In 1986 P&O purchased Stock Conversion, a leading property company, then the year after bought European Ferries, which had engagements in property, ferries and ports.
