RUMOURED SHIPPING MERGER

Dominion, Volume 11, Issue 146, 9 March 1918, Page 10

RUMOURED SHIPPING MERGER

INDICATED BY ACTIVITY IN SHARES

MOVEMENTS ON SYDNEY

'CHANGE

Though those interested in the shipping companies which were recently mentioned in connection with tho rumour that there was soon to be a big amalgamation of inter-State companies have denied that thore is any truth in the statements they have failed to stamp out tho story. The subject (says the Sydney "Sun") has been much discussed in shipping and financial circles during the past six weeks, and there aro well-informed men who will not believe that a big move is not pending.

Some go a 6 far as to put forward reasons vhy a merger should come about. The most important of these is that Howard' Smith, Ltd., part owners of the Caledonian Collieries and very much interested in Australian Steamships, Ltd., have lost their share of the coal trade to Melbourne owing' to Mr. John Brown's mines having secured a huge contract with the Victorian Government. Under tho agreement there appears to be very little 1 opportunity for Howard Smith to get into that business' again for at least five years. Tins, it is said, has caused tho company to look for'a new market. As matters now stand Huddart, Parker, Ltd., who have big interests in the Hebburn Colliery, supply large quantities .of coal to the ports i in the north of New Zealand, and unless there is an. amalgamation of some kind Caledonian Colleries will find it extremely difficut to get in. These points are backed up by tho fact that Hebburn Colliery has lots of coal and few ships, while with Howard Smith it is vice versa.

If a merger was arranged the companies interested in ships and collieries would become one, and, subject to the approval of the Commonwealth Shipping Board, would be free to handle ships and fuel in a way which would assure big profits.

The Adelaide Company, also mentioned in connection with the morger, carries on a sugar trade between North Queensland and Sydney, and has.a fine fleet of cargo ships. With these three companies rumour has it that they will find capital in the proximity of £3,000,000. In every instance where rumour of a merger has been published, the statements have been denied; but time proved that there was always good grounds for the story. This was the case particularly with the P. and 0. and Union S.S. Co. It was almost a year from the time the rumour gained currency till the official- announcement was made. Whether such will be the case in Australia, time only will tell. ■' v

The Sydney Stock Exchange was deeply interested in the rumoured shipping amalgamation. Many of the leading brokers spoken to said thai they had every reason to believe that the merger will take place, as numerous buying orders have been on the market, from well-known business men who claim to be "in the know." Even New Zealand speculators have been endeavouring to pick big parcels from Sydney. The shares of Huddart-Parker have been the chief attraction. Last week buyers frequently offered 375., a rise of Is. 3d. for the ordinary shares, but were not successful in locating sellers. Before the outbreak of war the shares of this concern were obtainable at 235. 3d. They stood at this figure 12 months ago, when they were increased to 245. Last November they spurted to 325. 9d., and at tho end of the year business was negotiated at 335. The company, which has a capital of £1,000,000, in 500,000 ordinary shares and 500,000 preference shares of £1 each, has been distributing dividends at the rate of 10 per cent, por annum. The company's reserves and undivided profits stand at £239,244. Tho concern is a big shareholder in the Hebburn Colliery.

Adelaide Steam during the week sold at £2 os. 2d., but later on buyers refused to give more than £1 19s. 6d. Sellers, however, declined,to give their limits. Before the commencement of the European hostilities the market value of this company's scrip was 235. 6d. ' Twelve months ago business was negotiated at 245., and at the end of last year 335. was paid. The capital of the company is £775,045 iii £1 shares. The reserve and undivided profits of the concern were shown in the last balance-sheet a5'£395,000. Howard' Smith, Ltd., which has a controllable_ interest in the Australian Steamships.- Ltd., and the Caledonian Colliery, Ltd., were persistently inquired after on 'Change at 345. 3d., but sellers were not about under 345. 9d. Twelve months ago the company's ordinary shares were dealt in at 245. 3d. They went to 30s. last November, while a / few weeks ago the market price' was 3os. 6d. The company's issued capital stands at £1,979,233 in £' shares, and tho reserves and undivided profits at £57,832.