AUSTRALIA’S DEAL

Dominion, Volume 26, Issue 219, 12 June 1933, Page 9

AUSTRALIA’S DEAL

White Star Line’s Grievance “VERY HARD BARGAIN” London, June 9. Mr. A. B. Canty, managing director of the 'White Star Company, presiding at a meeting of the company, said, in referring to the Aberdeen-Common wealth Line, that during the White Star Company’s default, the directors and voting trustees endeavoured to arrange with the Australian Govern ment a new basis of dealing with the unpaid balance. These efforts proved abortive, and the directors learned with dismay and disappointment that Australia had decided to realise its security under debenture charges on the fleet. “I am unable to give adequate expression to the feelings of the directors at this disastrous ending to the transaction,” said Mr. Cauty. "but their opinion is that you are the victims of a very hard bargain.” During the whole period of the White Star Company’s ownership of the vessels, he added, they were operated under conditions rendering it impossible to show a profit from which dividends could accrue. The Australian Government was well aware of this, yet it had chosen to exercise Its strictly legal rights to enforce its security at a very heavy loss to the White Star Company. < The directors are of the oninion that the Government has already received full value for the ships, and it would be barely an act of grace for the Government to cancel remaining Indebtedness. Representations in that direction have already been made. MR. BRUCE EXPLAINS Sale of Seven Vessels DIMINISHING ASSETS (Received June 11. 6.30 p.m.) London. June 10. Replying to Mr. Cauty’s speech, Mr. Stanley Bruce. Australian Resident Minister. In a statement, said that seven vessels were sold to the White Star for £1,900.000. They cost £7,000.000 to build. When the White Star Company got into difficulties in 1931 a moratorium was granted, and no action was taken to March. 1933, after every effort has been made to come to a working arrangement satisfactory to both parties. The only offer the White Star Company made would have resulted in the payment of a sum less than the annual interest charge Thus the debt would not have been reduced, and the asset on which it was secured would have been progressively diminishing in value. In the circumstances the Government. as custodians of the rights and interests of the Australian people, had no alternative but to direct the ships to be sold.