CABLES AND WIRELESS

Dominion, Volume 29, Issue 228, 23 June 1936, Page 9

CABLES AND WIRELESS

Speculation on Coming Changes

GOVERNMENT’S INTEREST

By Telegraph—Press Assn.—Copyright. London, June 21. The city is speculating on the nature of the changes impending in the directorate of Cables aud Wireless, Ltd. It is generally considered that the Governnient will take a closer interest in the "affairs of the company and that it desires someone more closely representative of Government interests to become both chairman and managing director of the operating company. The Government is vitally concerned in the strategic value of the cable system, which wireless competition _is making uneconomic, and is considering the possibility of bringing the wireless, cable and air-mail services under a central control. The traffic index for May, 67.6, was the lowest recorded for that month. A section of the board is known to favour .drastic, economy cuts, and some of the directors consider that the company Is paying the Government too much for the beam rental and consider it should receive compensation for uneconomic cables which it is not allowed to scrap. Matters have been brought to a head by demands for reduced wireless and cable charges. The company argues that this would prevent payment of dividends, but it is pointed out that the company is hopelessly over-capi-talised, and it is suggested that it should split into the original component parts and start afresh on a free competitive basis. The company also complains that it is suffering from the competition of subsidised foreign services operating at uneconomic rates.

A cable dated June 19 stated thatJMr. J C. Denieon Pender, governor and joint managing director, had resigned from Cables and Wireless Ltd., it was believed owing to a disagreement regarding policy. The “Daily Mail’s” City editor said that Mr. Pender’s resignation coincided with rumours of widespread changes in Imperial communications. It was suggested that the Government was likely to take over an interest in the cable and wireless combine for strategical purposes, appointing a nominee as a director on the The City editor of the NewsChronicle” says that the reorganisation of Cables and Wireless involved the resignation of one managing director, Sir Norman Leslie, and that, unlike Mr. J. L. Denieon Pender, who retains his governorship of the holding company, Sir Norman will resign his directorship in. that company too. Treasury approval is required of the chairmanship of the operating company. Mr. Wilshaw, joint managing director, is the favoured candidate. The position carries a salary of £15,000 a year. _______