COMPANIES PROMOTION

Wanganui Chronicle, Volume 77, Issue 218, 14 September 1934, Page 11

COMPANIES PROMOTION

REDWOOD FORESTS, LTD. STATEMENT BY MR. HCOKLY. The following statement was handed to the Companies’ Promotion Commisn sion on September 10 by Mr. F. F. Hockly:— e “As my name has been prominently o mentioned in the Commission report on a the above company, in its second in- , terim report, I beg leave to lay before j the Commission the following statev ment setting out the history of my connection with the company. “I joined the directorate on Scptems ber 27, 1929, and by letter to the chairp man dated September 3, 1930, resigned d my position as from the end of the is company’s year. As I had been a dit- rector for a period of eleven months r and one week, I regarded that as imminent. “When asked to join the company I regarded it as a recognition of my well-known interest in afforestation, and I accepted the invitation as an opportunity to help to establish a valuable industry for the Dominion. There is no more valuable tree grown in New Zealand than redwood. “I had no hesitation in doing so as I was wholly satisfied with the charac- -- ter- and standing of the people with e whom I would be associated, namely, it my fellow directors, the trustee for the bondholders, the New Zealand Insurance Company, Ltd., and Messrs, d Earl, Kent, Massey and Northcroft, the !S solicitors to the company. I was no one’s nominee. I joined the board quite untrammelled and unprejudiced and remained so until I resigned. “At the first meeting I attended the secretaryship of the company was brought before the board. Mr. McArthur offered to do the work for a nominal sum—l think £25. Mr. Twigden’s services were costing about £3OO. j As there was a sharp difference of opinion on the matter among the directors, I asked that the question be deferred for a week in order that I might consider the matter, and this w’as agreed to. When the matter came again before the board I had been unable to see any sound reason why the obvious saving should not be made. The company was in financial difficulties. Mr. McArthur’s staff was capable of carrying out the work, and I voted that the offer be accepted. “As the company was in financial difficulties only matters dealing with usual routine business came before the board until the scheme for reconstruction was presented to me. I gave it mature consideration and could come to no other conclusion than that, if it could be carried out, it would be a considerable benefit to the bondholders. The latter were, of course, the persons whom the directors were primarily concerned to protect. The purchase of the the necessary land to carry out the scheme from Kotahi Lands, Ltd., did not appeal to me, owing to the personnel of the board of directors of the land company being similar to that of the forestry company, and I said so. On learning, however, the terms of the purchase, namely, that no cash was to . be paid, but that the whole of the consideration was to be satisfied by the transfer of shares in Redwood Forests, Ltd., then of no market value, I realised that it was a satisfactory deal for the forestry company and I agreed to it. I also realised that no such arrangement could be come to with any company other than a company deeply interested in Redwood Forests, Ltd.' There was also this safeguard that the scheme could not be put into operation without first obtaining the consent of the bondholders. After a very intensive campaign for and against the scheme the bondholders did approve of it, and to-day they have two acres of planted forest for every bond they hold and the trustees for them hold £7 per bond on their account. “However, before the approval was obtained I resigned my position, and I have taken no further part in the man- J agement of the company. My resignation was dictated by personal reasons ’ and I parted with my co-directors on friendly terms/ “As far as the investments are concerned I cannot at this stage profess to recall exactly what was done in each case. The general impression I ] have is that in every instance a valuation by a competent valuer was produced to the directors. I am fully assured in my own mind that every Iran- J saction appeared entirely regular—otherwise I should have questioned it at the time. The Kotahi Land Com- ; pany’s mortgage is, of course, now paid off. The position of the others I do not know. “In conclusion I wish to say that I am not, and never have been, in any way whatever connected with any of the companies whose affairs arc at present the subject of investigation by your commission, other than Redwood Forests, Ltd.”