CASH STORES

Evening Post, Volume CXXIV, Issue 62, 10 September 1937, Page 17

CASH STORES

UNITY OF INTERESTS

MACDUFFS-SHILLINGS

The Stock Exchange has been advised that an extraordinary general meeting of Macduffs Ltd. will be held on September 18 for the purpose of obtaining the shareholders' ratification of the directors' proposals for the amalgamation of the company with Shillings Ltd. In a circular to shareholders, the directors of Macduffs Ltd. set out the basis of amalgamation as follows:—

A new company to be called Macduffs Ltd., is to be formed having a capital of- £500,000 divided into 350,000 ordinary shares and 150,000 6 per cent, cumulative preference shares.

The directors of the new company will be composed of members of the present boards of Shillings Ltd. and Macduffs Ltd.

Shillings Ltd. will sell the whole of its undertaking and assets to the new company for £137,500 to be satisfied by the allotment of 137,500 fully-paid-up ordinary shares in the new company. As further consideration the new company will take over liability for all the liabilities of Shillings Ltd. Macdufls Ltd. will sell the whole of its assets and undertakings to the new company for the sum of £152,500 to be satisfied by £30,000 cash and 72,500 fully-paid-up ordinary shares and 59,000 fully-paid-up preference shares. . The new company as part of the consideration will take over the whole of the liabilities of Macduffs Ltd.

The new company will immediately make a further issue of 100,000 of its 6 per cent, cumulative preference shares and 40,000 of its ordinary shares to the public, making a then paid-up capital of. £400,000. The directors of Macduffs Ltd. state that they and the directors of Shillings Ltd. have examined very extensively the trading and financial positions of both companies and have come to the conclusion that the proposed amalgamation will be of great benefit to the shareholders of both companies. There are numerous economies to be effected aggregating, a considerable financial saving to both companies by a reduction of head office and general operating costs which is equivalent to a substantial net profit to the proposed new company. The buying power of the new company will be considerably increased and distribution facilities immediately extended. At present Shillings Ltd. has eight stores and Macduffs Ltd. has six, and it is proposed that the stores of both companies, when amalgamated, will carry composite stocks, thereby widening the distributing power to 14 stores of the merchandise of both companies. Macduffs Ltd. will receive from the amalgamation £30,000 in cash, 72,500 fully-paid-up ordinary shares in the new company, and 50,000 fully-paid-up preference shares in the new company;

The ordinary shareholders of Macduffs Ltd., namely, Messrs. W. T. Eichards, L. O. Boyd, and N. B. Boyd, have arranged that when the amalgamation is completed preference shareholders will receive in addition to an equivalent number of preference shares in the new company for the number of preference snares held, a bonus of two fully-paid-up ordinary shares in the new company for every five preference shares at present held in Macduffs Ltd.