SULPHUR AND GUANO

Sun (Auckland), Volume 1, Issue 20, 14 April 1927, Page 9

SULPHUR AND GUANO

MYSTERIOUS DIVISION OF SHARES A PARDONABLE CURIOSITY In its first article on White Island, THE SUN was able to give an outline of the transactions affecting that property. It now proposes to make some reference to a portion of the profits arising from these operations. This aspect of the matter is no less unconventional, but is somewhat more of a mystery. More than 99 per cent, of the shares of the Vancouver Company were held by Mercer and Miles in 1925—37,447 out of ay. issued total of 37,500. It is difficult to trace transactions in these shares because, as THE SUN is advised by its Vancouver agents, no annual report or balance-sheet of the (vendor) company was filed in 1926. This is apparently required by the laws of British Columbia. The prospectus of the Auckland company states that Mercer and Miles held, in July, 1926, 23,000 shares in the vendor company. Therefore, if this statement is correct, they must have transferred the balance of 14,447 shares to some person or persons unknown. The prospectus did not state that any other person interested in the promotion had any interest in the vendor company. The shareholders of the vendor company were then pt the time of the j sale: (a) The holders of 53 shares subscribed for cash. (b) Mercer and Miles, of 23,000 shares, and (c) Persons unknown, of 14,447 shares. These shares were evidently converted into shares in the Auckland company on the basis of 16 new shares for every five in the Vancouver company, or 3 l-sth for every one share. Therefore the 120,000 “vendor shares” in White Island Products, Ltd., would have been issuable in that ratio, 73,600 to Mercer and Miles, and 46,230 to persons unknown. Apparently money fiad to be found to pay off the “serial gold notes” in order that the title of the vendor Gould be cleared, and as payment of these had been guaranteed by Mercer and Miles, and there is no other disclosed source for such payment, it appears to THE SUN as if 30,000 of their 73,600 shares were those sold in America. This would leave 4.3,600 shares for the two military men, as an addition to their profits on the sale of the island to the Vancouver company in 1925, and to any drawings from that concern. The returns filed in Auckland do not show any block of shares remaining in the names of Mercer and Miles, nor do they show the 46,230 shares to which persons unknown had become entitled. All that they do show, by a document filed only in February last, is a block of 90,000 shares in the name of the protean Mr. Coburn, who had been director, solicitor, secretary and liquidator of the Vancouver company. THE SUN deems it unlikely that Coburn paid £90,000 for these shares, or that they were a gift to him, but it may be excused for believing that he now acts in yet another capacity, this time that of trustee. It is not out of place to observe that while the process' of transferring shares from one name to another, and of finally placing shares in an Auckland company in the name of an attorney in Victoria, British Columbia, is perfectly legal, it is also quite unusual. THE SUN may therefore be pardoned for some curiosity as to who were the persons unknown who appear to have received 46,230 fully-paid shares in White Island Produces, Ltd., and as to what consideration they gave for those shares, and still further, as to why they bury them so far from the scene of operations? No doubt the investors who purchased contributing shares in the company w'ill participate in this feeling, among other emotions.