THE COMMUNICATIONS MERGER.

Otago Daily Times, Issue 20764, 9 July 1929, Page 12

THE COMMUNICATIONS MERGER.

POSITION OF MARCONI COMPANY. COMPLETE CO-ORDINATION. (Phoji Oce Own Correspondent.) LONDON, May 31, Lord Inverforth, chairman of the < Marconi Wireless Telegraph Company, in his speech at the annual meeting, referred to the Imperial and International. Communications, Limited, and explained the position held by the ..Marconi organisation under .the new merger. ~ “ 1 think it is necessary” he said, "that I should"clear away a misapprehension which appears _to exist that, as a result of the formation of Cables and Wireless, Limited, the Marconi Company will, in effect, lie going out of business. This is not the fact. The Marconi Company has. in its name a goodwill of considerable commercial value throughout the world. Whilst it is true that the company will be disposing of all its traffic .assets, and that ' Cables and Wireless, Limited, will own a very large proportion of the shares, the Marconi Company will continue to carry, on its sales and manufacturing business and the research incidental to, and indeed essential to, the success of that business.; . . Although the telegraphic services of the Empire will in. future be operated by Imperial and International Communications, Limited, the shares of that company will not be held by individuals, but by the Marconi Company, and by the Cable Companies, whose shares in turn will be owned by Cables and Wireless, Limited. You will-see, therefore, that the ownership of all the companies rests with the shareholders. of Cables and Wireless, Limited. GOVERNMENT SAFEGUARDS. / “To avoid any danger that the control of Imperial and International Communications, Limited, fay Cables and Wireless, Limited, might be exercised contrary to the public interest, the Government insisted on the following safeguards;—The boards of all the companies to be identical ; two of the directors, one of whom is to be chairman of Imperial and International Communications, Limited, to be approved by the Government and an Advisory Committee to be set up representative of the Home Government and of all the Empire Governments. ' _ “ Your directors welcome these conditions, and especially the formation of this Advisory Committee. They are confident that on all questions of general policy such , a committee will be of the greatest value, riot only to the Empire, but to Imperial and_ International Communications, Limited, - “ The ■ commercial operation and control of these great companies is left entirely free and unfettered, but on general questions of policy there will be an opportunity, which the directors will always welcome, of consulting the Advisory Committee, That committee will be a body entirely outside both the companies, so as to be able to exercise an impartial judgment on any questions which may come before them. We look forward to working in the friendliest possible spirit with this Advisory Committee. UNIFIED CONTROL. “It will be some time before complete co-ordination of the two great organisations can ,be effected, and until that coraplcte_ co-ordination has been effected the earnings of the company will not reflect the large economics which co-ordination will bring about. It is our determination to bring the. two organisations completely together throughout the world with the least possible delay. That process must of necessity take some time, but when it is completed we .are satisfied that the revenues of the company will be fortified by considerable economies of working. “Your,directors also take the view that under modified control and with a spirit of commercial enterprise inspiring the management there are many fields for development, not only within the Empire, but in the great foreign communities we are proud to serve, which, when fully established, should be revenue producing. Whilst, therefore, I do not wish shareholders to form extravagant anticipations of the return on their shares in the new company in the immediate future, we do not hesitate to repeat what wo said in the report, that we are confident shareholders will best be serving their own interests by exchanging their shares for shares in Cables and Wireless, Limited.’’