The Hawera Star. SATURDAY, MARCH 9, 1929. BRITISH STEEL MERGER.

Hawera Star, Volume XLVIII, 9 March 1929, Page 4

The Hawera Star.

SATURDAY, MARCH 9, 1929. BRITISH STEEL MERGER.

Delivered every evening by 6 o’clock in Hawera. Manaia, Normanby. Okaiawa, Eltham, Mangatoki, Kaponga, Alton Hurleyville, Pa tea, Waverley, Mokoia Whakamara. Ohangai, Meremere, Fraser Road, and Aiarata.

The recent merger of Vickers, Ltd., Cammed Laird and Co., Ltd., and Vickers-Armstrong Ltd., is the first successful large-scale attempt to rationalise the British iron and stool industry. Amalgamations in this trade were frequent enough between 1916 and 1920: but they all differed fundamentally from the one just concluded. The earlier amalgamations were of particular firms engaged in heavy manufactures and the mines that provided them with their raw materials, but the present merger is an amalgamation of manufacturing firms, and has nothing to do with the securing of sources of raw materials. Rationalising the British heavy industries involves not only the unification of separately managed but similar enterprises, but also the break-ing-up of unwise unifications within single firms that have taken place in the past. About twelve mouths ago Vickers and Armstrong-Whitworth, which are among the principal combines in Great Britain, separated two of their sections, which experience had shown to be unsuitably joined together, by cutting off their armament work, heavy

'steel, and shipbuilding enterprises from jtheir eivil industry. But the numerous undertakings which still remained in I the combined non-armament section of the two firms have proved to be far from homogeneous, so that the new merger is concerned with further division of enterprises as well as with the amalgamation of previously unconnected managements. The merger, which is in two parts, with the second of which Viekers-Armstrong are not connected, unites the steel interests of the participating firms in the lirst agreement, and their rolling-stock interests in the second, thus accomplishing at one and the same time a unification of managements and a division of enterprises. The chairman of the board of Cammcll Laird and Co. insists that the merger is not designed to compete with other British firms, some of whom it may eventually include, but that it is hoped that it will enable British steel manufacturers to make a vigorous and successful hid for trade in all the neutral markets of the world. The agreement has been made necessary by the development of elaborate machinery and by the example of firms in other countries. It must be admitted that it is only on a small scale compared with the largest mergers elsewhere, but it is “a unique combination of firms engaged in the manufacture of the highest grade of steel. ” The amalgamation will make possible economies in production, improvements in technical efficiency, and in sales organisation, and a development of research, that could probably be arrived at in no other way. It is important not only as an achievement, but also as an example. Whether it is an example that will be generally followed it is as yet too early to say, but it is encouraging to note that already t.wo other important firms are negotiating a fusion of interests. Once it has begun, the process of rationalisation is likely to continue at a constantly increasing speed.