A MUDDLE

Wanganui Chronicle, Volume LXXXIII, Issue 19784, 7 March 1927, Page 7

A MUDDLE

MARCONI’S AFFAIRS MANY RISKS TAKEN SHAREHOLDERS’ MONEY LOST. PLANS FOB REORGANISATION. SWEEPING CHANGES. }By Telearraoh—Per Frees Assn.—Copyright.J Received March 6, 9.45 p.m. LONDON, March 5. A committee representing English shareholders in Marconi’s have issued a report based on an investigation of the Company’s affairs by Sir Gilbert Garnsoy. Tho committee states that his report reveals a lamentable record of financial incompetence, repeated failure and improvident risk of shareholders’ money. Largo sums were lost in foreign bank shares, timber forests, quarries, tinplates and arbon syndicates, all outside companies. The general objects of the prospectus of the new issue in 1925 were inaccurate and misleading. Marconi’s board recommends a reduction of capital by 10s a share, after which it is increased to £4,000,000 by the issue of 3,250,000 10s shares. Reserves Balded. Mr Marconi resigns from the chairmanship, and has been appointed president. Marconi’s directors explain that the reserves wore raided in 1923 and 1924 to the extent of £3,013,000 to provide for depreciation in assets. After the appropriation of the reserve credit balance in 1924, the deficiency amounted to £1,625,000 and accordingly a reduction in capital is necessary to prevent continual revision of assets, probably preventing a dividend for many years. If the recommendations are accepted, a dividend will be possible for 1926, when the profits exceeded those of the previous year. It is proposed to wind up non-wireless companies, which have no chance of prosperity, reorganise the management, and concentrate on the manufacture and sale of broadcasting material, carry out beam wireless schemes, modernise the existing station and secure from the Government a license for wireless stations throughout the world. Beam Services. The directors anticipate that the South African and Indian beam stations will be opened within three months, and the United States and South American stations will be opened this summer, and the Australian stations will be opened when the post office operates the British end. It is expected that facsimile transmission will reduce the cost of working. Recalling that Mr Marconi repeatedly desired to resign the chairmanship to devote his energies to the technical side, the directors recommend his appointment to the presidentship, enabling him to give attention to the fullest development of that work. Replying to the English shareholders’ committee, the directors state that the present Board was not responsible for the losses. On the contrary, they disposed of investments to which the English committtee objected. The present directors’ remuneration for seven years totalled £107,417, including amounts paid to Mr Marconi as technical adviser and to Mr Kelleway, the managing director.