THE GOTHIC GOLD DREDGING COMPANY.

Otago Witness, Issue 2425, 5 September 1900, Page 21

THE GOTHIC GOLD DREDGING COMPANY.

TO THE EDITOR. _ Sir,— On reading the very full report of tha Gold Czar Company's meeting in this morning's issue one cannot fail to be struck with the judicious conclusion arrived at by the directors, who are deserving" of the highest' praise for the courageous and business-like stand they have taken with the vendors before taking over the propeity. The same arguments apply, only in stronger degree, with the Gothic claim a little further up, and if the directors fail to make' the same searching investigations as did the Czar directors they have failed in theii: duty to the shareholders. Both were floated at the height of the boom, when no discrimination was exercised; both are heavily Ipaded — the. Czar XIOOO in cash and -2000 paid,, the Gothic £2150 in cash and 1500 paid ; both have banks of a height that no dredge built yet has been able to work ; and in both a considerable area, has never been proved either in xichness or depth, while the water supply at certain seasons is insufficient. The fact is that these, with others m the same locality, now aban-

• doned, are premature in the light of the experience gained since by the New Alexandra and other dredges. It would theiefore be a reckless waste of public money to go any further, and if tho directors fail to appreciate the position a meeting of shareholders should be convened at once to take steps to wind the ihing up. Action such as this with all doubtful concerns js the first thing necessary to put the industry flu a strong and healthy foundation. — I am, Etc., SiIAHEHOLXIER. [We have submitted the letter to the chairman of directors of the Gothic Gold Dredging Company, who Las replied: — "The cases aie not at all analogous ; besides water rights and sluicing plant now at work on the claim, the company have secured a freehold. The giound has already been pioved, and its depth is known. The case of the New Alexandra Company has no bearing upon the matter whatever." — Ed.] I'HE GIBE'S BEACPI (MOLYNEUX RIVER) GOLD DREDGING COMPANY (LIMITED). TO THE EDITOR. Sir, — I hold contributing shaies i:i the above company, which 1 took up when it, was floated. am informed by circular that the directors propose to increase the capital by .£2500 to cover liabilities and to acquire a piece of adjoining ground. Jndging from the balance sheet for period ending July 31 the company should only be sonic £500 in debt when the dredge starts if the capital i' left as it is. This £s not good business, buc starting m debt seems to be the way with mesi diedges. If the : rea rf the claim was big enough vhen the company was floated it should be big enough now; ceitainly to increase the contributing capital by nearly 40 per cent, piineip?!!" (apparently) to acquire further ground ot doubtful value does th^t' seem to me wi&e in She? e haul times. Tlif :'ew hundred pomids necessary to complete the tlredge, I think, f-hculrl be covered by bank overdraft^ If the amount recmired to ocmplete the clrocloo is imflerstated, then "1 think the directors have pursued a most reprehensible course in net, , calling the shareholders together before any contracts were let to give them an oppoitunity of "saying whether the work should proceed or 2iot: The shares in the company are now quoted at some 5s discount, so that any additional shares issued at par would have to oe subscribed for by present shareholders. I trust this will not be asked for. J for one will rertainly not take up another share under tho circumstances. The practice of not discovering until shares are paid uj> that the capital is ir sufficient is becoming so common that the isoc-rer something is done to stop it the better, nnd if by any- chance the Gibb'g Beach Company is one that is being inn on these lines, i - sincerely hope it will bs made an example of even if I loss my money over it. — I sm, etc., Ccjkious.