MEAT WORKS SALE.

Auckland Star, Volume LVII, Issue 25, 30 January 1926, Page 9

MEAT WORKS SALE.

m EFFECT OF VETO. WELLINGTON DIRECTOR'S PROTEST. (By Teje&reph.—Special to " star.") WELLINGTON, this day. A long letter to the Minister of Agriculture has been sent by the directors of the Wellington Meat Export Company against the decision to refuse Borthwick and Sons a meat export license in respect of the company's works near Wellington, which Borthwicks proposed to purchase. The directors pointedly ask tho Minister to state his reasons for refusal. Mr. Hawken intends answering their communication, but is not at present prepared to discuss it. The directors express to the Minister their astonishment that his letter of refusal was communicated first to the ' Press. The letter proceeds: "You base j your refusal of the transfer on the grounds of public policy, but you do not state what these grounds of public policy are, and I am directed respectfully to ask that you be good enough to intimate ' them My directors consider that a grave injustice has been done to shareholders. The company has been in existence for 45 years, and has taken a considerable part in the development of the meat export trade in New Zealand. The chare capital is held by mixed shareholding of farmers and ordinary investors, but the latter hold over 60 per cent. In recent years the carrying on of tho business of the company has been very difficult, and the company was faced with the alternative of selling or closing down. In the interests of shareholders I it waa deemed advisable by the directors to sell. The proposal to sell was readily confirmed by the shareholders, and the effect of the sale, if it could have been completed, was that shareholders would receive 8/ in the £. The vetoing of the transfer of license means that the sale i must now be cancelled, and the position of the company is more difficult than ever. It is well known that there are no buyers for such a concern in New Zealand. The company tried without success to sell to other New Zealand concerns prior to offering the business to Messrs. Borthwick and Sons, Ltd. in offering to and agreeing to sell to that company the directors considered they were selling to a British firm of old standing and of good repute, which already owna three small works in New Zealand, and which has been a buyer j of meat in New Zealand and a seller j and distributor in the United Kingdom j since the inception of the frozen meat trade. Your refusal to consent to a transfer to this company has resulted in your shutting out from the Dominion British capital, and in co doing, it is submitted, you have created a dangerous precedent which must assuredly react prejudicially to the general interests of the Dominion. An immediate effect of your decision, bo far as my company is concerned, is that the company cannot sell its assets. There are no buyers in New Zealand, and outside buyers arc vetoed. The assets therefore ere practically valueless unless the company can carry on and pay its way." The letter adds that if the company is forced into liquidation shareholders will receive practically nothing, and will have a just grievance against the Government. The directors question the status of the Meat Board in assisting to decide the matter, as the statute | names the Minister as the authority j "Members of the Meat Producers Board j were not appropriate advisers to con- j suit. It must be remembered that .some | at least of the members of that hoard J are not disinterested in meat works or freezing companies. Some are directors in a meat company in direct opposition to my company, and my directors fo.el , that however fair-minded such men may j endeavour to bo it is difficult for them j not to be biased on the question they were consulted about." The directors conclude by asking a reconsideration of tho decision, in the interests of 850 shareholders. The general manager of the company states, in an interview, that Borthwick's only reason for considering the proposal to purchase the Wellington Meat Export Company's business was to ensure a regular supply of the Wellington Meat Export Company's lamb, of which they make a feature in their distributing trade.