Proposed Dairy Company Amalgamation.

Northland Age, Volume 6, Issue 27, 25 March 1937, Page 5

Proposed Dairy Company Amalgamation.

Opinions Expressed at Meeting of Oruru Suppliers Definitely Against Proposals Since the sitting of the Executive Commission of Agriculture at Kaikohe, at the beginnig of this month, there has been quite a discussion among dairy farmers in the district as to what exactly took place at that sitting and of the effect of the findings of the Commission so far as these affected the Kaitaia Company and the Oruru-Fairburn Company. To enable the position to be placed before the suppliers of the Oruru Company and to give them an opportunity to fully consider the question of amalgamation with the Kaitaia Company before they will be called on to vote on the proposal at the extraordinary general meeting of the Company to be held on Wednesday, April 7, a meeting was held at Peria on Monday evening when at the invitation of the suppliers, the directors who were present at the sitting of the Commission gave a resume of what occurred there. Finding of Commission The finding of the Commission as presented to the meeting by the secretary of the Oruru Dairy Company, Mr. Wilton, and contained in a letter from the Commission, were: That the Commission was not prepared to allocate a zone to the Oruru Company for the following reasons: If an area was taken from Kaitaia and allotted to Oruru, the pay-out of Kaitaia would be reduced without a sufficiently compensating benefit to the Oruru Company. Such a diversion of supply could not be justified on the grounds of the conservation of quality, because the distance from the Kaitaia Company’s factory to its more remote supply areas is insufficient to affect the quality of the cream. It would be difficult to allocate cream collection routes to the Companies if the area were divided. The Commission’s first duty is to the suppliers, and it is bound not to take any action on behalf of any dairy company if the effect of that action would be detrimental to the interests of the supplier's of the district as a whole. Under these circumstances the Commission is strongly of the opinion that the Kaitaia Company should purchase the assets of the Oruru Company at a fair valuation and the two companies amalgamate. If this were carried out, the Whangaroa Company was prepared to take over part of the Oruru Company’s supply and the compensation for this supply would assist in the liquidation of the liabilities of the Oruru Company. The following is an agreement signed by both Kaitaia and the Oruru Company directors: The Kaitaia Company agreed to take over the whole of the assets and the liabilities to the bank and on the machinery, of the Oruru Company, but these liabilities are not to exceed £6,300. The Oruru Company is not to incur any further capital liabilities and is not to pay out to its suppliers for butterfat supplies more than the net return for their butter after making adequate provision for depreciation of plant and building. The directors of both Companies further agreed to place these proposals for amalgamation before their shareholders, with the recommendation that they be adopted. Directors’ Views Over 300 suppliers and others interested in the Oruru Company were present at the meeting which was presided over by Mr. J. Pearson, who explained the reasons for calling them together, by some of the suppliers. He apologised for the unavoidable absence of the chairman of the Company, Mr. J. W. Hoskin, and then called on Mr. J. Garton, a director, to explain what happened at the sitting of the Commission. The Commission asked the directors of the Kaitaia and the Oruru Companies to see if they could not come to some arrangement said Mr. Garton, but although a conference was held nothing came of it, it was hopeless; there was no chance of coming to any arrangement with Kaitaia. When we went before the Commission, any suggestion we made was jumped on. We asked for a zone, but the Commission said that they could not zone suppliers from one

company to a lower payout company. We had settled with Hokianga for that Company to take Mangamuka, as we expected that we would gain territory. The Commission then suggested amalgamation and when we found that we could not get a zone, we tentatively arranged a scheme of absorption with the Kaitaia directors. We knew that these proposals would have to be placed before shareholders and that they would not agree. This resume of what occurred before the Commission was supported by other directors, Messrs. C. J. E. Barriball, J. Forsythe, J. Larkins and D. Tracey, who were present.

Mr. W. A. Wilton, secretary of the Oruru Company, then read the Commission’s findings, and stated that this was based on misleading figures supplied by the Kaitaia Company which figures he had, at the time challenged. It was stated that Kaitaia last year paid out id. per lb. for butterfat supplies more than did Oruru, this was incorrect as the figure was .4d. in favour of Kaitaia, and even this was more apparent than real, as Oruru gave concessions to its suppliers that Kaitaia did not, and this reduced the difference in the payout. Other figures were produced by Mr. Wilton to show that Oruru was in as good a position as was Kaitaia. Although regulations have been gazetted, continued Mr - . Wilton, for the witholding of a license by the Commission, and so preventing a factory from manufacturing butter, still I think that these regulations cannot be enforced by law, and that if the Oruru suppliers turn down the proposals for amalgamation, as I am sure they will, as three-quar-ters of the shareholders present at the meeting will have to vote in favour to carry the proposals, then we will get a zone. Mr. Wilton concluded by exhorting his listeners to stick to their factory and their district, as he has always done. Mr. R. T Wrathall then spoke against the proposals as a member for the Mangonui Riding in the Mangonui County Council, stressing the detrimental effect the alleged excessive carting that would take place, would have on the roads if the factories amalgamated. We know, said Mr. A. Garton, one of the convenors of the meeting, that not one acre in this district is producing half of what it is capable of so who can say that in ten years’ time Oruru will not be having an output of 1,000 tons of butter and Kaitaia 5,000 tons, so there is room for both factories in the County. Further questions were asked by suppliers and answered by the directors or the secretary. It was stated that the Mangamuka suppliers would not supply the Hokianga factory but were continuing to supply Oruru ; also a request had been forwarded to the Native Department by a large number of natives supplying the Kaitaia factory, that their cream should be sent to the Orui'u factory. A vote of thanks to the directors and secretary for explaining the proposals to the suppliers, to the convenors and to the Chair, concluded the meeting.

RETURNS OF LAND DUE APRIL 9 Penalty lor Neglect Furnishing a return of land is an annual duty imposed by law upon all land-owners who at noon on the 31st March hold land of an unimproved value according to the Government valuation in excess of £SOO. The unimproved value is the value of the land exclusive of buildings, fencing and other improvements. The form of retui'n has been made as simple as it is possible to make it. Forms are obtainable at all post offices. Details of the land held at the 31st March, 1937, should be entered in Part 3 of the form. Under Part 1 particulars of registered mortgages and un-paid purchase money should be shown each year irrespective of whether any change has taken place or not. The return should be completed and returned to the Commissoner of Taxes, Wellington, C.l, on or before the 9th April. Any person neglecting to furnish a return is liable to a penalty not exceeding £IOO. Neglect to furnish returns at the prescribed time not only renders taxpayers liable to prosecution but also in many cases for considerably more tax than would otherwise be payable. The Act provides for an exemption in respect of registered mortgages or balances of purchase-money in certain circumstances, but to obtain the exemption it is essential that a return showing particulars of mortgages owing should be furnished. The Department cannot assume that mortgages are owing, and in the absence of a return the assessment is made as though the land were unencumbered. The tax assessed in these cases may be in excess of the amount which would be payable if the return had been furnished. All persons liable to furnish returns are ) therefore advised in their own interests to forward their returns on or before the above date.