COMPANY NEWS B.M.C. LOSS

Press, Volume XCV, Issue 28237, 27 March 1957, Page 17

COMPANY NEWS B.M.C. LOSS

Interim Dividend Passed

(N.Z. Press Association—Corry-right) LONDON, March 25 The British Motor Corporation formed by the Austin-Morris merger, announced to-night a loss on the first six months of the. financial year and said it would pay no interim dividend. B.M.C. makes Austin, Morris, Riley and M.Q. cars, and a range of commercial vehicles. The announcement blamed “the many difficulties with which the motor industry has been encumbered in recent months.” Last year, B.M.C. paid an interim dividend of 4 per cent, and a final of 8| per cent., making a total of 12J per cent, for the year.

PAINT FIRMS’ DISPUTE

Injunction Sought

(New Zealand Press Association) AUCKLAND, March 26. Hill and Plummer, Ltd., Auckland oil and colour merchants, are seeking an injunction to restrain Pinchin, Johnson and Co. (N.Z.), Ltd., and Taubmans Products, Ltd., Wellington, from selling their paint products to customers of Hill and Plummer in the Auckland province. Hill and Plummer allege breach -of contract by the defendant companies. The case, which is likely* to involve a long hearing, concerns the activities of Hill and Plummer (Merchants), Ltd., a subsidiary in which the plaintiff firm and Pinchin Johnson are partners. Hill and Plummer claim that Pinchin Johnson broke an agreement between the two firms by selling Taubmans paint direct to the trade, instead of through Hill and Plummer (Merchants), Ltd. In evidence today, the chairman of Hill and Plummer, Mr A. U. Wells, referred to the recent “takeover bid attempt” -by Taubmans Industries, Sydney. The Sydney firm’s offer of £3 16s 9d for Hill and Plummer shares would have meant that Taubmans got a warehouse worth £lOO,OOO and shares in the subsidiary for nothing, said Mr Wells. Since the refusal of Taubman’s offer to buy the shares, the Sydney firm had made a direct approach to shareholders. When Mr Haggitt, for the defendant companies, suggested in crossexamination that there was nothing improper in this, Wells said that it was not usually done in New Zealand.

He said that the deadline date for shareholders’ acceptance of the offer was April 30. Re-examined by Mr Garland, for Hill and Plummer, Ltd., Wells said that Hill and Plummer’s turnover in 1947 was £150,355, and the profit was £18,689. In 1955 the turnover was £450,000, and the profit was £17,000.

BANK’S COMMENT ON BID

“ Offer Unlikely To Be Approved ”

The transfer of shares in a New Zealand company to an overseas company requires the prior consent of the Reserve Bank. It is unlikely that the bank would approve the offer made by Taubmans Industries, Ltd., Sydney, to Hill and Plummer, Ltd., Auckland. This statement is made in a letter from the bank to the Auckland firm. "It would be appropriate at this juncture to mention that any arrangement which calls for the transfer of shares in a New Zealand company to another company domiciled outside New Zealand in exchange for shares in the overseas company, requires the prior consent of the Reserve Ban*, in terms of Regulation 3 of the Finance Emergency Regulations, 1940 (No. 2). Bank’s Policy “Unless there are special circumstances which would warrant an exception to the Reserve Bank’s present policy,” continues the letter, “it is unlikely that our approval would be given to the proposal already submitted by Taubmans Industries, Ltd.” The letter says that the normal manner in which an overseas company obtains a holding in a New Zealand company is by the remittance of funds to New Zealand through the banking system in the currency of the country in which the prospective shareholder is registered. "Where this procedure is followed, no difficulty is encountered in the remittance of dividends to the overseas shareholders or, under the bank’s current policy, to the remittance of capital realisations to shareholders permanently resident in countries within the sterling area.

TASMAN PULP PROSPECTS

Sales Of £loom In 10 Years Likely

(New Zealand Press Association) AUCKLAND. March 26. Total sales of the Tasman Pulp and Paper Company, Ltd., over the next decade might total well over £loom.. said the chairman (Sir James Fletcher) at the annual meeting of the company today. Sir James Fletcher said this after admitting that the figures for the company’s losses to date were “huge in anyone’s language,” but that it was necessary to remember they were dealing with a huge project. The net loss for the last year was approximately £ 1.75 m. and, with the loss for the period immediately before October, 1955, the accumulated losses were just in excess of £2.5m. Last year’s loss was almost wholly the amount of depreciation written off the assets of the company. Use of Natural Steam Sir James’ Fletcher said that there were indications that the coihpany would be able to make very substantial savings on the operating costs of the mill by using natural steam for process purposes electric power. They were awaiting a comprehensive technical report by the consultants, Fletcher - Bechtel - Raymond, on the basis of extensive field work. No final decision on the use of steam would be made until the report was ready. Over-all, the profit position as shown in the accounts had no real

relation to the future prospects of the company, Sir James Fletcher said. The resources were there, the quality was there, and power in plenty would be there.

Cyclone, Aust.—The Cyclone Company of Australia, Ltd., Melbourne, is negotiating to make an offer for the ordinary capital of William C. Lynch Holdings, Ltd., Newcastle. Both companies make tubular steel and wire. William C. Lynch has a paid capital of £63,000 in 5s ordinary shares.