TIMARU GAS COMPANY

Press, Volume LXXXIX, Issue 27073, 23 June 1953, Page 10

TIMARU GAS COMPANY

PURCHASE OF PLANT BY CITY COUNCIL

PRICE ESTIMATED AT £87,500 (From Our Own Reporter) TIMARU, Jufie 2L The terms of an agreement between the Timaru City Council and the Timaru Gas, Coal, and Coke Company, Ltd., for the purchase of the company’s plant, were announced this evening at the monthly meeting of the council. Two arbitrators and an independent umpire have announced valuation figures and awards on items where the arbitrators failed to agree. The amount arrived at is £87,500, made up as follows:

Valuation of plant already agreed upon by the arbitrators, £9332, Valuation of plant not agreed upon by the arbitrators and determined by the umpire. £9500. Stock, subject to adjustment at the date of possession, £16,111. Valuation of the freehold, £39,450. Valuation of other assets to be determined, say £7OOO. Working capital and contingencies, say £6107. Total, £87,500. These figures were contained in a report tabled at this evening’s meet-* ing. The report stated: “The agreement with the Gas Company provided that the date of possession shall be September 30, 1953, or such later date as the parties may agree upon, and the payment of the purchase money shall be made within six months from the date of possession, together with the interest from the date of possession to the date of payment at the rate of per cent, per annum.” The report was adopted by the council. It stated that the council should appoint a special committee of three councillors to act with the three directors of the company. The councillors appointed were Crs. P. *B. Foote, W. A. Petrie, and A. A. Wakefield.

Among other conditions covering the date of possession and the operation of the gas undertaking were the recommendations that the chairman of the gas committee should be a councillor; that the committee manage the gas undertaking as at present and where necessary make recommendations to the council for adoption: that the present undertaking of the company be carried on by the council so far as is practicable in the same manner as at present and no major alterations be made in the administration of the undertaking; and that the above conditions apply until such time as the purchase money (yet to be determined) is paid in full to the company. The agreement is subject to the Timaru City Council being granted l authority by the Local Government Loans Board to raise the required loan, and to the council’s being able to raise the loan. Application will be made for authority to raise a loan up / he Purchase price of £87,500 at 4 per cent, on a table mortgage basis spread over 25 years with a right of repayment. . Speaking to the report this evening, £ r ; P; , said that no-one sad5 ad ” ewed S. e tak,n g over of the gas company with any pleasure. “It can only be said that the amalgamation will be undertaken. perhapT loss to the council, but hot with a very great loss," he said. Mr Foote was answering Cr. A. A. Wakeflolrl had been suggested the undertaking was not going to be a paying proposition. 5 De a . * our year we are going to have to pay out £5569 in various tTe y £Mdo S V s £3o ° mor e than me ±.0200 profit shown in the company s last balance-sheet. In addition we are going to have to face a bill of between £lOOO and £llOO, the cost of relining a retort,” said Cr. Wake-

J 1,?” , stated that the Loans Board could make a provision of its approval ? direction that a poll of ratepayers be taken. Even if tfiis provision is not included in any decision of th2 Loans Board a poll could oe demanded by ?atepayer r £ presentng 5 Per cent ' oi tha