ONE BIG COMPANY.

Auckland Star, Volume LIX, Issue 177, 28 July 1928, Page 19

ONE BIG COMPANY.

WIRELESS-CABLE MERGER. AGREEMENT PUBLISHED. NO IXCHEASE 1\ KATES. ALL( K. AT lON UF THE I'RUiT IS. VV ELIjIXGTO-V, Eridav. Tliu IVimo .Minister to-night tor puliln.'ulioii tiie lolluvving aumiiuivv in i r.c ri'jK>rt of tiie VV lvelt'ss and (,'iibh'ft Conference. JSo int'orniui . c;in yet he made available ay tu ilie . ...uuu oT 1 i.e .New /jciiiaiia Imvei i» inenl, [lending tho decision of all liie other Governmeuts concerned, but a statement on the subject will be made ir. the House in due Course. The report covers eight closely typewrit ten pages, and ends with the recommendations of the conference. These are:— The Merger Company to be formed will acquire as from April 1, 1928, all ordinary shares of the Eastern, Eastern Extension and Western Telegraph Companies, and all ordinary aud preference shares and debentures (if any) of the Marconi Wireless Telegraph Company. There will also be formed a communications company to which the cable and Marconi companies will sell as at April 1, 1928, all their communication assets, in exchange for shares. The Communications Company will, therefore, hold all communication assets of the Cable and Marconi companies. The Communications Com pi 1 ■: v will acquire the holdings of the t.ible and Marconi companies in tho<-e Communications companies in which the Cable and Marconi eoinpnnu'rc holding is less than 100 per cent. The Communications Company will acquire Government cables and lii'l'l i !ii!-.c of the Post OAiee beam.

Tiie rapital of the Communications Company is not to exceed at it> inception £30,000,000.

The Communication's Company is to bike over as from April 1, 1928. the Paciiic Ca-ble Board's cables, the West Indian cable and the wireless system worked by the Pacific Cable Board, the Imperial Atlantic cables and the lease of the Post Office beam service (including provision for the transfer to the company of existing staffs) on terms to be arranged. The beam service is to be leased for 2.3 years at a rental of (a) the basic sum of £250.000 per annum; (b) as from April 1, 1931, an addition equivalent to 12 per cent on any increase in the company's profits (t'rom the Communications service-.) above standard revenue. An amount, of £00.000 is to be paid in such manner as may be agreed.

The Board of Directors of the Merger Company, the Communications Company and Cable and Marconi companies will be identical. Two of the directors, one of whom shall be chairman of the Communications Company, are to be ptrsons approved by His Majesty's Government on the suggestion of the cable companies.

The standard net revenue of £ISC>S (exclusive of non-telegraphic investment revenue) from the Communications Company's services is to be fixed io the purposes of the company. .All net revenue from the Communications service in excess of that sum is to go as io 50 per cent fo the company and as "to 50 per cent to a reduction of rates or such other purposes as the advi.-ory committee niav approve. If additional capital expenditure i* incurred bv the Communications Company ill relation to the traffic there shall be added tu the above initial standard revenue an appropriate charge for interest at such a rate as may later be agreed.

The Communications Companv is to consult, in regard to questions of policy, including any alteration of rates, an advisory committee, which we suggest should include representatives of the Government's participating in the conference, to whom representatives of other parts of the Empire may be added as required from time to time with the upnroval of the Governments concerned.

Xo increase of the rates prevailing at the date of the formation of rho Communications Company is to be made, except with the assent of the advisory committee. Jt is to be agreed (a) that British control of all companies must be guaranteed; (b) that the Governments may assume control of the cable and wireless systems in time of war or other national emergency; (<■) that the fitrlitiurr services are entitled" to build and work cable or ire less stations for thenown purposes, but not for commercial purooses.

The Post Office in London will ve.-erve the right 1.0 conduct the external telephonic services of Great Britain, hu' will a "Tee with the company on terms, on which it will have Ilie right to u--< ♦he company's wir<<le«s s+at : ons. or no--f.ioim tliorcof for