WINDING UP

Waikato Times, Volume 122, Issue 20466, 5 April 1938, Page 6

WINDING UP

FINANCE CORPORATION SHAREHOLDERS’ DECISION MR M. M. SHAW LIQUIDATOR An extraordinary general meeting of shareholders of the Finance Corporation of New Zealand, Limited, held in Hamilton yesterday afternoon, decided, by a majority vote of 35,100 shares to 5720, “that the company be wound up voluntarily.” On the motion of the chairman, Mr P. H. Saxton, Mr M. M. Shaw, the general manager of the company, was appointed liquidator and, on the motion of Mr C. L. Mac Diarmid, the shareholders authorised and recommended the liquidator to obtain the assistance of Messrs Saxton, F. E. Hughes and ■S. S. J. Sheaf as an advisory committee. In opening the meeting, the chairman briefly traversed the reasons which had led the board to recommend voluntary liquidation. During the last few years the ordinary business of the company had been gradually dwindling. To-day, though there was a considerable sum still out in loans, there was not sufficient profit In this form of activity, In view of the cost of the company's own financial accommodation. Development Work Hampered In view of this, the activity of the company had been turned more to farming and the Strathmore property had been developed very satisfactorily. Even this work, however, had been carried out under restrictions, since the various properties had to be developed out of other profits and if more were devoted to such development the company might be faced with substantial arrears of preference dividend at a later date. It was the opinion of the board that if the company's assets could be liquidated at the relatively high values prevailing to-day such a step would be in the best Interests of all shareholders. An earlier winding-up would have resulted in considerable loss of capital, but current figures showed that asset* had a slight surplus over capital Invested. There could be now, at the most, only a slight loss. The chairman then moved that the company be wound up voluntarily, Mr D. Andrews seconding the motion. Board OrltlolMd Criticism of the attitude taken up by the board was voiced by Dr. L. R. De Castro and also by Mr W. H. Adams, who appeared for a preference shareholder, and also as the representative of an estate holding both ordinary and preference shares. The former speaker suggested that trading conditions must have been up to expectations since the Strathmore estate was purchased so that it was difficult to understand why the board now wished to be quit of the business. Unless there were buyers for the farm properties, he did not see cause for liquidation. Mr Adams suggested that the action proposed by the board would result in the “pillaging” of the preference shareholders'} The history of the company, he said, had been one of misfortune after misfortune. He submitted that liquidation at the present, time was wrong and that the duty of the board should be to try and 6ell the various properties before suggesting the drastic step of winding-up. The chairman stated that in the financial statement given to the meeting, assets had been shown at a conservative valuation. The board did not admit that they could not carry on, but felt that liquidation would be more In the interests of shareholders. Amendment Moved At this stage the following amendment was moved: “That the shareholders of the Finance ‘Corporation of New Zealand, Limited, request that the directors shall further explore every means of selling the farm properties and other assets of the company at the best possible prices and terms, a price being fixed as a ressrva of at least 75 per cent of the last balance-sheet values, the fnatter of winding-up the company to be further considered at the next annual meeting.” On a show of hands the amendment was lost, whereupon a poll was called for on the motion. As stated above, the motion to wind-up the company voluntarily was carried, the votes, or an ordinary share-holding basis, being 35,110 for the motion and 5720 against it. A suggestion that the Official Assignee be appointed liquidator lapsed for want of a seconder and Mr Shaw’ was appointed on the motion of the chairman. Following the passing of the resolution recommending the formation of an advisory committee to assist the liquidator the meeting waa declared closed.