WINDING-UP PETITION

Sun (Auckland), Volume IV, Issue 944, 10 April 1930, Page 9

WINDING-UP PETITION

CEMENT COMPANY’S AFFAIRS SHARE-SELLING EXPENSES Press Associaton WELLINGTON, Today. A petition for the compulsory wind- ! ins-up of the -National Portland Cement Company, Limited, came before the Chief Justice, Sir Michael Myers, in the Supreme Court yesterday. Mr. G. G. Watson and Mr. G. E. Arms appeared for the petitioner, James Costello, of Westport, and Mr. W. XI. Cunningham appeared for the company. I The petitioner held 200 contributory shares, said Mr. Watson, and he also claimed to represent 4,185 other contributory shares. The company was incorporated in 1924 with a nominal capital of £300.000, which was subsequently increased to £350.000. Actually 27,950 contributory shares had been issued, and there were also 25,000 , fully-paid shares issued. It would be seen from the figures before the Court that in the five and a-half years which had elapsed since the company was incorporated, less than onetwelfth of the contributory shares had been issued, and the total amount received from shareholders on account of calls to date was £9,188. His Honour observed that three points which struck him were: (1) The delay in commencing operations; C2) every sixpence received from the shareholders had been spent, and there was nothing to show for the expenditure: (3) the company was a cementmaking company, and wanted to make something else. Counsel said it appeared that to get in £9,000, there had been spent roughly £B,OOO. The company had gone to the expense of printing and circulating no fewer than three prospectuses. Even if credit were given to the company for heavy preliminary expenses, it seemed that the expenditure had been somewhat staggering, in view of the comparatively small return. RESULT REGRETTED

Mr. Cunningham said that there was no suggestion of misconduct in the operations of the company. The result was much to be regretted, but had the capital come to hand the expenditure in relation to the capital would have been shown on a much better footing. Unfortunately, it cost as much to try to sell the shares as actually to sell them. Of the money spent to date, £3,048 represented money spent in acquiring property. Owing to the financial depression, the company had not been able to get capital to start operations. Xlis Honour: Are you justified in saying that? For quite a long time there was any quantity of money available for investment. I am not speaking of the last eight or ten months, but prior to that money was lying idle and could not be invested. It may be, of course, that people thought the company had no chance against wellestablished concerns which were strongly entrenched. Counsel then dealt with the question whether it could be said that the substratum of the company’s undertaking had gone as a result of the proposal to go in. for hydrated lime. He pointed out that the acquisition of suitable property, as stated in the primary object, had been carried out. The attitude of the directors, said counsel, was that after receiving notice of the petition, they had suspended operations and had agreed to put the position frankly before the Court. His Honour said that it was admitted very properly by Mr. Watson that the directors had acted in a fair and frank manner. Decision was reserved.