PROSPECTUS OF THE DRURY TERRA COTTA CO., LTD.

NZ Truth, Issue 881, 14 October 1922, Page 13

PROSPECTUS OF THE DRURY TERRA COTTA CO., LTD.

The above prospectus \3 issued m booklet form, and for that reason one would expect to find that its covers contained between them 1 rather more information than is usual when the broad sheet form is adopted. However, the whole thing is a disappointment to any person who turns to it for vital facts connected' with the manufacture of terra cotta products, or for solid reasons that would induce the investor seeking a safe depository for his money to bpcome a partner m this joint stock adventure. The proposal'offered to the public is that a company with a capital of £50,000 divided into 50,000 shares of £1 each be formed by persons sufficiently optimistic as to be swayed by a series of unproved statements depending solely/ upon the kind-hearted reports drawn up m terms very favorable to the promoter of the company. "Cambist" has LOOKED IN VAIN for any evidence m the shape of analysis, or m working costs, m connection with the matters covered by this prospectus. ,The two "reports" which cover the main portion of the. prospectus are utterly devoid of such tedious, though necessary, particulars. The report of Mr Millikin, C.E., is merely an attempt at an essay on' the subject of Terra Cotta ' manufacture and the use of the product as applied to building and other purposes. Considering the high professional achievements of the gentlemen m question, this is very unsatisfactory for it leaves the average non- technical person quite m the dark regarding* the merits, or demerits of the proposition. Especially unfortunate, too, for the"" monied man. who desired, to help on the Dominion, and himself, by making a, sound investment m a prosperous concern. Turning to the "report" of •'Mr John Dawson, M.N.Z. Soc. C.E. and M.N.Z. Inst. Surveyors, * the whole matter contributed by this gentleman is BOILED DOWN ''' to three items — namely, locality, quality and quantity. For the first item tie"* is not m the least responsible. Nature did the trick by placing this particular clay area "m rising country comprising part of lot 64 on plan No. 119 of the parish of Opaheke, and distant about 2% miles from the Drury railway station, or about 25 miles from Aubkland city." As to quality, he states that "the best deposit comprises a very excellent clay m a solid formation, and analyses , supplied to me shows that it has ail the fire-resisting elements and virtues of the best English clays, such as 'Stourbridge/ etc., and' also the additional and material advantage of the almost total absence of all injurious elements, such *as iron, lime, magnesia and alkalis. This accounts for the very beautiful color and finish of the samples of Terra Cotta manufactured from these clays." ,Now the point is, where are the ANALYTICAL TABLES upon which this, gentleman dogmatises? Would it not be better had he told the promotor of the company, and the possible investors m it, whether he worked upon dry or wet analysis, and also whether his final remarks referred to Stourbridge Or Drury clays? So far as- "Cambist" is concerned there are, no examples of the D'rUry output of Terra Cotta to be found on a commercial scale m any part of the Dominion. The paragraph regarding the quantity of the clays m the existing quarries may be mere guesswork. There is not detailed estimation based upon proper survey to support the statement "that the quantities of these clays are, from" a manufacturing point of view, practically unlimited." The next point about the prospectus is to find out what the promoter gets out of the flotation of the proposed c6mpany. The vendor, Mr T. J. J. Albrecht, sells to the company his* patent double interlocking building block, 'and certain options over properties at Drury (24 acres near the railway station, and about 94 acres of .clay deposits, also leasehold title to tramway route from the clay area to the factory). The PRICE T;O BE PAID i . for this little lot is £'6000 m cash, and the company (if ever it reaches registration)^ will pay m addition to the vendor 'a royalty of Id per block on the , interlocking blocks produced. Behind the vendor, who is also a director, and may be the works manager of the company, are a large crowd of other persons who will become vendors "upon the company exercising- the options referred to m the memorandum of agreement." The company's provisional directors are offering the whole •if the capital for subscription, and "they reserve ■ the right to allot 15,000 shares only, or any number of shares exceedings 15,000 up to 50,000 shares of those app.lied for." Seven signatures are attached to the memorandum of association.' Six names are down for 250 shares each and the promotor stands for 5500 shares. It will be seen from this that 7000 shares are .•ilreacly taken up, so that the investing public need only subscribe for SOOO more to enable the company to be registered. It is the latter group which will provide the £6000 already referred to, but whether the concern can do any. developing of the proposition on this or the full amount of the authorised capital NO ONE CAN SAY, for theiframers of the prospectus hare not thought it necessary to prove from figures, estimates or other means, anything of that nature. In "Cambist's" opinion the problem is not worth trying out, and he can point to many other local manufacturing propositions which offer a better' inducement for the investment of £6000 m these times of money shortness. Assumptions cannot take the place of soundly reasoned facts. Tlie least that could have b.een done .was to furnish the Wasis of the pleasant conclusions regarding the profits to be derived from the manufacture of the patent interlocking blocks. The 5d difference between, manufacturing cost and the selling price does not really signify a profit to that extent. It appears to this writer that the overhead might swallow the blessed sd. But what is the/Use of pursuing the subject further? Let us be careful with our moneys.