bay of islands coal COMPANY.

New Zealand Herald, Volume XXVII, Issue 8422, 25 November 1890, Page 5

bay of islands coal COMPANY.

An extraordinary general meeting of the liny of Islands Coal Company was held at the offices of the Company, Queenstreet, yesterday afternoon, to confirm the resolution passed on the 17th of November, to reduce the capital of the Company. Dr. Campbell occupied the chair, and there were also present: Messrs. W. S. Wilson, G. I'. l'ierce, McGregor, Smith, Warnock, Rev. J. Campbell, T. Peacock, and Williamson. The Chairman said : At our last meeting' authority was obtained from you to reduce the capital of the company, and you have been called together to confirm that authority. Having so confirmed it, you are now to be asked to reduce the nominal capital from £10,000 to £4,000, and the actual capital from £30,000 to £3000. In asking you to make so startling a reduction it is only natural that you should _ be informed how it has come about that this is necessary. You can hardly be unprepared for what"! have now to place before you, as from what I have already told you from this chair, the working out of the mine has now for some time been foreseen to be within a calculable number of months. The hope that at one time existed of finding further workable seams of coal having been now fairly exhausted, it only remained for your directors to face the situation, and place the affairs of the Company on a proper footing. We hope before it becomes absolutely necessary to wind up the Company, to be able to pay shareholders one or more dividends, but this could not be legally done unless the company first went through the ordeal of reducing its capital, or wo might have found ourselves in the position of paying dividends out of capital, instead of realised profits. X have now to ask you to look at the last balance-sheet, and to draw your attention to the item.?, viz., leasehold of mine £4355, and permanent works £10,324. These sums have been carried forward from one balance-sheet to another, and were legitimate entries as long as the mine was a going concern, and could be looked to to remain as Midi. But these permanent works, drives, etc., to enable the miner to reach and deliver the coal when won, of course, cease to have any value when the mine is closed. The value, therefore, of the lease, as also of the permanent works, can only now bo estimated having reference to the amount of coal which the mine will still yield, and it has been written down accordingly. The items, land £2089, buildings £3787, and plant £15,842, have respectively been written down to as nearly as possible' the value which might reasonably be expected they would realise on the closing of the mine, and which amounts to £G0!K)? The large difference is, of course, represented in the decreased value of the plant, which unfortunately though representing, the figure set down as a working plant for working a mine will only realise for removal little more than for so much old metal. It is within the bounds of possibility that some new discovery of coal may be made on the company's property, but even if it were, this company not having the capital to work it, a new company and fresh capital would have to be called into existence, and we would only benefit by the sum for which we might be able to sell our interest. The following resolution, passed at the last meeting of the company, was confirmed That the articles of association of the company be altered by the insertion therein immediately after article 3 of the following article, namely 3a. The company may, from time to time, by special resolution, reduce its capital.'" It was then resolved, on the motion of the Chairman, seconded by Mr. Peacock, "That the capital of the company be reduced from £40,000 divided into 4000 shares of £10 each, to £4000 divided into 4000 shares of £1 each, and that such reduction be effected by cancelling capital which has been lost or is unrepresented by available assets to the extent of £0 per share upon each of the 3000 shares which have been issued, and are now outstanding, and by reducing the nominal amount of all the shares in the company's capital from £10 to £1 per share." This latter resolution will come up for confirmation at a further meeting of the company, to be held on the 10th of December next. •