POWER BOARD LOAN

New Zealand Herald, Volume LXIX, Issue 21295, 23 September 1932, Page 10

POWER BOARD LOAN

LONDON CONVERSION CITY COUNCIL AGREEABUE

The Auckland City Council agreed last evening to assist the Auckland ElectricPower Board's large loan conversion proposal by agreeing to allow the board to approach the debenture-holders direct. The chairman of the board, Mr. W. J. Holdsworth, in a letter to the Mayor, Mr. G. W. Hutchison, stated that the council was the holder of debentures for £22S,CXM), injuring on March 1, 1933, given by the board upon the purchase of the council's electrical undertaking and to cover the council's obligations in respect of debentures issued by it in 1912 and 1914. The board's sinking fund for the purpose would amount to only £14,500 at maturity.. All but about £7OOO of the total sum was held in London, and in Order to avoid the he'avy exchange on the transfer of funds thither, the board proposed to endeavour to arrange a conversion loan in London. However, it was too early as yet to decide upon the terms of conversion, in view of changing mar ket conditions.

The board, desired, if possible, to deal direct with the present debenture-holders, giving them the option of /taking fresh debentures in the new loan directly from the board, so that the council would be released from' any further obligations in the matter. The board had already made preliminary inquiries through the Bank of New Zealand to ascertain how and by .whom the debentures were held.

On the recommendation* of the Finance Committee, the council decided to grant the request, on condition ' that the form of letter to be sent to the debentureholders should be submitted to the Finance Committee for its approval.