CONVERSION OFFER

Dominion, Volume 37, Issue 114, 9 February 1944, Page 4

CONVERSION OFFER

Debt Domiciled In New Zealand NEARLY TEN MILLIONS Issues At Lower Rate Of Interest The Government’s proposals for dealing with debt totalling £9,839,080 domiciled in New Zealand and maturing on February 15, 1946, 'but in respect of which the Government has the option to repay on or after February 15, 1943, were announced last night by the Acting Minister of Finance, Mr. Sullivan. The proposals, he said, were in the form of a conversion offer contained in a prospectus now being'issued.

“The formal notice of the Governmentis intention to repay the loan on May 15, 1944, with interest to date of repayment will appear in this week’s Gazette.” said the Minister, “and also the Order in Council authorizing tile conversion offer. Though the actual conversion does not take effect till May .15, the offer of conversion will be open for one month, that is till March 11. Holders of the existing securities are therefore entitled to apply forthwith ibut not later than March 11 for conversion of their existing securities into one or other of the new securities being offered, that is 3 per cent, stock maturing on April 15, 1960-63, or 21 per cent, stock maturing April 15, 1949-51. In the case of the longer date’d securities holders are being offered conversion at the rate of £lO3 of new stock for every £lOO of existing securities, or in the case of the shorter dated stock £lOl of new stock is offered in exchange for every £lOO of existing securities.” “As the formal notice of repayment is being given in the Gazette,” continued Mr. Sullivan, “attention is drawn to the fact that if the conversion offer is not accepted by the holders of existing securities the amount involved will be repaid in cash with interest to the date fixed in the Gazette notice, that is, May 15 next. As regards holders of death duty stock in the present loan this same concession will be available in the ease of such persons converting into the new issues, so that the stock will still be available at par for payment of death duties in the event of the holder dying before the loan matures.

“The premium offered is designed to bring the interest return to holders into line with present market conditions, and as this is not a war loan the Government felt that in fairness to present holders in this loan, the returns to investors should be kept in line with market conditions. Forms of application for conversion together with a copy of the prospectus are being posted to stock-holders, and debenture-holders who do not thus receive a copy through the post can obtain one from any bank or post office money order office. “I feel sure that holders generally will agree that this offer on present market conditions is fair and equitable. It is hoped that all holders of existing securities will do their part to make the issue a complete success as such a result will enhance the credit of the Dominion at Home and abroad and facilitate the arrangement of war finance later in the year.”