The Frozen Meat Comapany.

Southland Times, Issue 9164, 12 March 1886, Page 3

The Frozen Meat Comapany.

TO THE BDIT3B. BIR,— MrG. W. Niohol has favoured you with a 'otter, which appeared in your Lsue of the 9ih ineUnr, by way of a critique ofyour leader relating to the fiaancial position i of the above Company. I shall not attempt j to follow Mr Nichols' arguments as I consider ie would be waste of time aid space. '; The question aa I understand it is — Have the directors of the Frozen Meat Company pureued a reasonably prudent course in endeavouring to force the Company into liquidation 1 I think lam safe in answenup in the negative. Befo c mo is the directors. 1 report (which wr3 subrniMel along with the baUiice-Fheet and statement of accouiia made up to the 3 1st December las') to the shareholder at thp annual mee'iag. This balance-sheet showed that the Company was then in a eound position, Its e-seti by this balance sheet wern thea £13,059 12s Id, or after d-du ;ti \>g pre* liminary expenses £12,83 s £s, againsr. which there are liabilities to the B »uk of New Z aland £±212 Us 5\ anH other liabilities of £6i 10*51, thus making thR total lUbilinea #4324 4>lod Bjsidej this there is -i biI&UJ6 of -£ L 72 9j 3.1 carried frjen profit and loss account. Now. assume that this bal« ance^sheet and statement of account* are genuine and show truly tha real position of the Company. The directors in th'ir r^gnrfc lay that the ''works are mw completely eq'iipp'.'d ami ready to C/mue cc operations," and that " th >.v are stioagly of opinion that, the operations of the Cum, .any cannot be satisfactorily c^nied on without a lar»jrr capital." The auacul inseting is tauldin t) c j mjn'h of Jauiary, and in the month of | February the directors propose to form a j new coapaay or go \n'o liq ii-lation. During this time no losses have beei mide, only the interest on £2500 or so running 00. On February 27ih an adjourned mC'lia^ of the Company was helJ, at which tha directors submitted a serins of rcsoliU.ion« f r the meeting to a lopt to go into liquiision. A ecbeme wa9 also subm.Ved whicfa was drawn up by a committee to form a now Company for the purpose of purchasing the wh-.ile of the assets of tha Frozen Went Company, by which g:heme practical y the sharehold- va of the latter Company would lose alltheir inve3'.m6nt9, unloi* tha^ bicim) shireholders in tha new Company. At this meeting the Chairman stated that the assets of the Company were then estimated at £,1 J ,434 13* 9<3. and lb* liability, rough'y speaking, at £2500. He also stated, according to your report, " that the directors wished to"b« relieved of their liability ; and therefore desired that the Company should be wound up and anotber started with a new capital." Accepting the Chairman's statement to convey what was meant by him as to the desire of the directors to havo the present Company [wound up, there cannot be two opinions in regard I to the matter. There appears under the Circumstances, to say the loa'fc of H, an indecent histe in the directors' proceedings. Because they pave the ba^k a guarantee to the extent of, say, £°000 and also, to protect th ; bank and thems Jv» s, gave a mortgage and bUI of s-*le over the whole of the property at tue Bluff b '.longing to th* Gotnv>a.r\y, valned by tbetisslvcs at £11,434, are these Buffi it'nt reason-! for desiring that the Company be wound up, or that a new Company be formed for the pnrpo*o of purchasing the pnweity at the Bluff at a price to rover vtry 'ike!y, only the liability of £2500'? I ask, wou'd p-udent nusiness men unier 6Uih circumstances adopt tbi a course ? They by their acUons h ive bl >wa oe the credit and prospects of ihe Company, and it will now be difficult to le-estab-lsh confidence in the concern. If there U anythng latent which is known to the directora and not disci >ped* in thar balance-sheet to the shareholders (which I have no reason to assume there i 3) it tn ght alter the ca' 6. Mr G. W. Xi hoi. in bis remarks at the meeting to which I h&v« refeired, sa ; d that at present winding up ' gpemad inevitable," and went on to way thnt the diresfors might be called upon at any time to pay up £2000. That the diractoTsbav.s of th?ir own accord given their guarantee of £2000 is no sufficient reason to urge the windin? up of the Company. The Company have not made any losaes worth mentioning, The fcbareholdets hard paid, up their calls, and now their interest in tha £pee%ig to he fry th.a wiß^ing

tip process. Truly may the shareholders say — '• w e elected leading business men of luvercargill to manage this concern and it has been managed." — I am, etc., ;• Observer. 10th March, 1886. ;