SHIPPING PROPOSAL

New Zealand Herald, Volume LXXII, Issue 22046, 28 February 1935, Page 11

SHIPPING PROPOSAL

WHITE STAR LINE QUESTION OF LIQUIDATION LONDON, Feb. 26 The White Star Line has called a meeting for March 7 to consider the advisability of voluntary liquidation. The White Star Line was formed in 1927 by the Royal Mail Steam Packet Company to acquire for £7,000,000 the share capital of the Oceanic Steam Navigation Company. The last-named company was one of fouf which continued to operate its own ships under the scheme for the reorganisation of the Royal Mail Steam Packet Company and associated companies, adopted in 1932. Following several years of difficulty, the reorganisation was an effort to save the fleet from disintegration which would have followed an enforcement of the rights of individual creditors. >

The Royal Mail Company was guarantor of the dividend on the £5,000,000 of White Star Line 6i per cent preference shares, and the proposals provided that the dividend for the one and ahalf years ended January I, 1932, would be satisfied in deferred creditors' certificates of the Royal Mail Company. Further fallii #4 due before February 1 of this year were also to be discharged in certificates. The articles of association of the White Star Company were amended in 1932, in fulfilment of a promise that full control of the company should be in the hands of shareholders. In January, 1933, the White Star Line reported a working surplus of £68,051 on the operation of its fleet, but, after charging interest and providing for two exceptional losses, there was a debit balance of £301,794. This, added with other items to debit, made a debit of £596,507 to be carried forward. The directors admitted that the book values of the fleet and of shares held in subsidiary companies were both in excess of current values. On January 1 last year, an agreement providing for the merger of the North Atlantic fleets of the Cunard and White Star Lines came into effect. Under the financial provisions of the scheme, the capital of the merger company was allotted as to 62 per cent to the Cunard Company, and as to 38 per cent to the White Star. An offer of Government aid for the construction of new ships »i'as a motivating factor in the merger, and the third reading of the North Atlantic Shipping Hill, empowering tho Treasury to advance moneys for this purpose, was carried in the House of Commons on March 15 last year.