THE OTAGO DAILY TIMES SATURDAY, FEBRUARY 11, 1928. MEAT COMPANIES’ FINANCE.

Otago Daily Times, Issue 20330, 11 February 1928, Page 10

THE OTAGO DAILY TIMES SATURDAY, FEBRUARY 11, 1928. MEAT COMPANIES’ FINANCE.

The Minister of Agriculture is the authority for a, statement, contained in a letter written by him as recently as Monday last, that it is a mistake to suppose that the value of meat works as a. security for advances by a bank has been affected, seriously or otherwise, by the policy of the Meat Producers’ Board, endorsed by the Government, that there should be no transfer of an interest in freezing works in the Dominion to any but New Zealand companies. The shareholders in meat preserving and freezing works will however, it is to be feared, receive this intimation without much elation, for they will hardly fail to notice that the Minister in effect contradicts himself when he says in the same letter that the only purchasers of any meat works in existing circumstances are the overseas companies. If the overseas companies are the only possible purchasers at the present time, then since the Government, on the advice of the Meat ProducersBoard, refuses to grant to any overseas company the export license which it requires in order to operate any works that may be acquired by it, it is a logical conclusion that freezing works are unsaleable. Mr Adam Hamilton, who is a member of the Meat Producers’ Board, seems to think that the board by bringing about the position under which there can be no acquisition by overseas companies of an interest in New Zealand moat works, is protecting the assets of the freezing companies. A form, however, of protection of assets that renders them uuroalisable is one from which most companies would desire to be saved. Apparently, the bankers of the Dominion decline to share the comfortable optimism of Mr Adam Hamilton, which assures him that it is for the benefit of a company that it should be

deprived of any possible sale for its assets. The bank which has the largest business in the Dominion has itself experienced the results of the policy of tlie Meat Producers’ Board and the Government that forbids the transfer of an export license to any overseas concern. One extensive meat preserving establishment has fallen into the hands of this bank, which has, as a consequence, been compelled, or has found it expedient, to carry on a freezing industry as a side line to its more legitimate activities. It is not prepared to take the risk of a second occurrence of the kind. Consequently, it has informed a Southern freezing company that, uuc.il all restrictions on the transfer of licenses are removed, it is not prepared to make advances on the security of its works. It may be assumed that this intimation conveys the considered judgment of the associated banks. In the face of it, the opinion, complacently expressed by the Minister of Agriculture, that “ it would not make the slightest difference to the bank’s policy if every restriction on the sale of the majority of the meat works in New Zealand were removed to-mor-row,” hardly seems to merit a moment’s consideration. The action of the Meat Producers’ Board in practically vetoing any sale of freezing works to overseas concerns was prompted by a laudable desire to prevent a valuable industry from falling under the control of operators who might exhibit small respect for the interests of the producers. It must be acknowledged, however, that it has actually had an effect that is extremely embarrassing to those who are engaged in the industry and require capital for the prosecution of it. To pretend that it is not so, as the Meat Producers’ Board and the Minister of Agriculture do, is simply futile.