NEW ZEALAND FARMERS' CO-OPERATIVE.

Press, Volume LXI, Issue 18421, 30 June 1925, Page 11

NEW ZEALAND FARMERS' CO-OPERATIVE.

TO THE IDITO& Of "THE TBISS." Sir. —The writer would make it plain that lie has never had an interest in the Fanners' Co-operative. Their bal-ance-sheet) has been a source of 'wonder t-i him fm- nearly twenty year.?. It has been evident to a student- oi" accounts that their system of trading was decidedly faulty, and gcnerally spcaking, they were carrying too much canvas for their financial resources. This has been plain to the man in the street, and should have been equally plain to the preference shareholder when making his investment. Frankly, the preference shareholders who have been squealing during the past few days are distinctly off-side. They were quite willing, and no doubt wcl[ pleased, to allow the unfortunate debenture holder to accept 0 per cent, instead of B'per cent., so that their precious hide could bo saved. They are quite willing td 'sacrifice the ordinary shareholder, even to his last penny, yet sit quietly by, expecting all things to come to themselves. Undoubtedly they have agreed to penalise the do bentufe holder, hut when their' timfl comes to make their contribution they cannot sec that tho proposition now offered by the manager and directors is very ■much in their interests. Tho longer the Co-operative find themselves in the position of hemp unable to meet interest to preference shareholders, the less the preforcir'o share will be worth. It is quite evident 'that once thev could ho in a position to pay dividends again, preference shares would immediately become more valuable on the market, and preference shareholders would also immediately he in a position to sell their shares, and iu that way materially benefit. The writer has only spoken fo the present manager once. However/ he realises that ho is carrying a. very heavy burden. He is not in touch, with a single director, so this letter is written purely from a public point of view. It'is vitally necessary that the finances of this big concern bo stabilised as soon as possible. Its unsatisfactory condition for some years has seriously affected similar classes of business, as many of the Farmers' clients have not been free either to buy in the markets, or pav accounts. Tho present position of some of tho shareholders who have staked their all in this concern is certainly not to bo envied. Frankly, the writer has not a. shadow of doubt" but that the d : roctors aoid manager are doing the right thing.in this connexion.

What is tho ordinary shareholder doing for the preference shareholder? At present he has allowed his share capital to bo written down. He has no chance in the world of getting a dividend for some time to come. He is also liable to pay big sums in cash from time to time to keep this concern going. This money, by the way, is stabilising and holding .up the value of the preference share. Considering tho circumstances, surely "tho preference shareholder must see that he is expecting tor> much, notwithstanding the fact that his legal position is perfectIy S ound.-Yours, elc, manag^r _ Juno 29th, 1925.