J.B.L. Group Seeks Small Piece Of Sanford

Press, Volume CIX, Issue 31942, 20 March 1969, Page 18

J.B.L. Group Seeks Small Piece Of Sanford

('New Zealand Press Association)

AUCKLAND, March 19.

J.B.L. Consolidated, Ltd, the Auckland property development group with interests in fishing and clothing manufacture, is seeking a minority interest in Sanford, Ltd, in a bid to “bring about a strong front in the fishing industry.”

The first-come, first-served, offer for the Auckland fish! merchant is 50c in cash plus! 12 J.B.L. redeemable 50c pre-; ference shares for every five I Sanford ordinary shares. It is opposed strongly by the directors of Sanford. j The preference shares will' carry an 8 per cent dividend and earn one-quarter of any dividend over 10 per cent paid on ordinary J.B.L. shares.

industry by associating the activities and overseas marketing facilities of Auckland Seine Boat with Sanford.

This, he said, would result in mutual benefits while the offer would give Sanford shareholders a better return on their investment than they had experienced in recent years.

They will be redeemable in cash after five years or, at the option of the shareholder, be renewable for a furtherfive years on the same terms. J.B.L. will apply for stock exchange listing of the preference shares. SMALL INTEREST

J.B.L.’s activity in the fishing industry was small compared with Sanford’s, but nothing but good could stem from closer liaison and cooperation. PROFIT BY J.B.L.

In its first full year, to October 31, J.B.L. earned a consolidated profit, before tax, of $53,566, after absorbing 5133.000 in export promotion and development costs. The group's turnover was 81,691,517, and, after tax of $2027, the net profit wag $51,529, of which $41,701 was paid in a 10 per cent dividend.

The company does not specify the percentage of the $820,000 ordinary capital of Sanford it is seeking, but it is understood that it would be satisfied with a fairly small minority interest. Because of the take-over regulations, it cannot accept mope than 49 per cent. The offer is conditional on registration of transfers, and no major changes will be made in the capital structure of Sanford or in its financial and assets position. J.B.L. DIVERSIFICATION J.B.L. was formed in June, 1967, to take over the interests of the J.B.L. group, which was then concerned mainly with property developments and leases. Since then it has taken over Harmel Clothing Manufacturers, Ltd, and Auckland Seine Boat Association, Ltd.

The earning rate on average funds was 12.8 per cent, and on capital it was 12.4 per cent. Shareholders’ funds of $488,173 included capital, all ordinary, of $417,010, which is to be increased soon to $500,000. Minority interests were $12,655, and term liabilities $26,000. Fixed assets were $225,630, and investments were $81,405, with working capital of $116,333. Intangibles of $103,460 included a $66,356 premium on the acquisition of subsidiaries and $35,035 for export promotion expenses. SANFORD RECOVERS

In a letter to Sanford shareholders, the J.B.L. chairman (Mr J. E. Jeffs) said that a policy of diversification was being pursued.

The net profit of Sanford, which reached a peak of $92,134 in 1962, slumped from $82,210 to $41,672 in 1966 and $42,379 in 1967, but made a strong recovery to $60,315 last year. The dividend was cut from 8} per cent to 5 per cent in 1966, and none was paid in 1967. Last year, after earning 4.1 per cent on funds and 7.1 per cent on capital, the company paid 5 per cent to shareholders.

The group had established a subsidiary in Sydney for marketing fish and other exports, and its branch in Tokyo had obtained what the directors believe to be the largest single fish order for New Zealand. STRONG FRONT

Mr Jeffs said the object of the offer was to bring about a strong front in the fishing