WHITE STAR COMPANY

Otago Daily Times, Issue 21977, 12 June 1933, Page 7

WHITE STAR COMPANY

A HARD BARGAIN NOT COMPLIMENTARY TO AUSTRALIA (United Press Association.) (By Electric Telegraph—Copyright.) LONDON, June 9. At the White Star Company’s meeting Mr Cauty, who presided, in referring to the Aberdeen and Commonwealth Line, said that during the White Star’s default the directors and voting trustees had endeavoured to arrange with the Australian Government a new basis for dealing with the unpaid balance. These efforts had proved abortive. The directors learnt with dismay and disappointment that Australia had decided to realise its security .under the debenture charges on the fleet. “I am unable to give adequate expression to the feelings of the directors at this disastrous ending to the transaction, but in their opinion you are the victims of a very hard bargain.” During the whole period of the White Star’s ownership the vessels operated under conditions rendering it impossible to show a profit from which dividends could accrue. The Australian Government was well aware of this, yet it had chosen to exercise its strictly legal rights and to enforce security at a very heavy loss to the company. The directors were of opinion that the Australian Government had already received full value for the ships, and it would be barely an act of grace to cancel the remaining indebtedness. Representations on that point had already been made. REPLY BY MR BRUCE. LONDON, June 10. (Received June 11, at 7.30 p.m.) Replying to Mr Canty’s speech, Mr Stanley Bruce, in a statement, said that seven vessels were sold to the White Star Company for £1,900,000 which had cost £7,000,000 to build. When the White Star Company got into difficulties in 1931 a moratorium was granted and no action was taken up to March, 1933. After every effort had been made to come to a working arrangement satisfactory to both parties the only offer the White Star Company made would have resulted in the payment of a sum less than the annual interest charge. Thus the debt would not have been reduced, and the asset on which it was secured would have been progressively diminishing in value. In the circumstances the Government, as custodians of the rights and interests of the Australian people, had no alternative but to direct the ships to be sold.