TEMUKA LINSEED COMPANY.

Temuka Leader, Issue 1645, 11 October 1887, Page 2

TEMUKA LINSEED COMPANY.

A general meeting of the shareholders of the Temuka Linseed Company, convened by the Diraotors, was held on Friday evening at the Oddfellows’ Hall. Mr John Talbot presided, and explained the position of the Company as recorded in our report on Saturday. He impressed upon, the shareholders that only the prospect of making twine had induced them to carry on the Company, Finding that the fibre on hand was of unsuitable quality for this purpose there was practically no resource but to stop operations.

Mr W. Slorey understood that the factory had been working since the last meeting. Ho would like to know as fully aa possible th® position of the Company. The Chairman thought it would be well to defer discussion until some motion was before the meeting. Mr Miles then moved Temuka Linseed, Oil, Cake, and Fibre Company be wound up voluntarily.” Mr W. Lyon seconded the motion. The Chairman then invited discussion, and replying to Mr Storey said that the receipts of the Company since last meeting were roughly £3OO ; interest to the amount of £l7O hod been paid and the balance had been expended on labor. The Chairman further explained that the half yearly interest fell due since the last meeting and had to be paid. Eeplying to Mr Job Brown, the Chairman said the Directors were not responsible for the £IOOO of outstanding liabilities aa well as for the £4400 due to the Bank. Mr Brown desired to arrive at an approximate idea of tke value of the security held by the Directors. The Chairman thought that was a difficult matter to arrive at. The Directors, as a body, had never gone into the matter. He (the Chairman) had has own ideas of its value, but was not disposed at present to reveal them. M«* Storey also pressed for more accurate information. The Chairman had no idea of the value of the security. Mr Brown would like to know the property tax valuation, if nothing more definite could be arrived at. The Chairman said it was impossible to give any definite idea of its value. As one of the guarantors he hoped it was worth £4400. Dr Hayes desired to know if the directors had formed any plan of the manner in which they intended to dispose of their assets I The Chairman said no definite scheme had been proposed, because the directors hoped that the shareholders would relieve them of the responsibility. If the company were not wound up the directors would have 'o take steps usual in similar cases. Mr Meteon asked the Chairman’s opinion of the best steps to take. The Chairman would like to see the shareholders relieve the directors of their guarantee, Mr O. Matthews aeked if it were not true that when the spinning frame was purchased it was stated that a profit of at least £3O a week could be made. The Chairman said ho believed some such statement had been made. Doubtless too rosy a view bad beau taken of the situation. Mr Brown would like to know how it was that the present fibre was not fit for

binding twine. The Chairman said that he could not explain. There had been about two tons made, but the balance would not stand the necessary strain.

Mr Brown and Mr Mason both desiring more definite information on the subject, it was explained that the best twine that hud been made was that manufactured from fibre purchased from Raugiora. The Company’s fibre was some of it “ hand-scotched ” and some of the flax used was g'own on inferior ground. The fibre was good enough for rope-making, but not for twine.

Dr Hayes thought it extraordinary that the very ABO rope-making had been D'g’ected, The machinery was there with no mverial to supply it. Mr Ta'bot thought some of the responsibility lay with the shareholders. Those who had land suitable were indisposed either to grow flix themselves or let it for what they considered an exhausting crop. Dr Hayes asked if the Directors were aw >re that they had not sufficient material to keep them going at the time that they purchased the spinning plant! Tlie Chairman replied in the affirmative, but stated that there was a season’s crop then to come in.

Replying to several shareholders, the Chau man said that there was practically no choice in th a srlec ion of the flax. The Company were desirous of inducing tarm -rs to grow it, and could not very wall reject it. Last season had boen a bad one, and none of the crops were up to the ruarlr. The Company’s own crop was a very poor one.

Mr l.womey asked if the Company would pay if good fibre had been produced ? 'The Chairman was sure of it.

Mr Ttvornoy thought the sanguine expectations of the manager were justifiable under the cirnurnstiinces.

Mr .Rutland wished to know if there aas a prospect of any flax being grown this season, and also the amount it would oust per share in interest to carry the Company on! The Chairman could not say,

—— - - ■ •—1 Mr Rutland asked as to the position of ■ the girls lately brought out from Home to M work at the factory ? I Mr Metson said that perhaps they could arrange about them. The Chairman could not say much about them. The girls were pretty sure of employment, for there was little doubt but thrt the works weuld go on somehow, Mr Storey said if the liabilities were being reduced, why not carry on ? The Chairman said the reduction was too slow. Tho creditors were getting impatient. Some discussion here ensued as to the issue of new shares and the reasons why the money could not be refunded as promised. It was explained that at the time the shares were issued the prospects of the Company looked fairly well. The Directors were anxious to refund the money paid on the new shares, and also not to insist on those signed for being taken up, but on referring to their lawyer they found it impossible for them to move in the matter. The Directors themselves would not receive any benefit. They were in the same boat as the rest of the shareholders. They had each taken two fully paid up shares. Mr Fostlethwaite said that it was only within the past six weeks that they had found out about the fibre, otherwise perhaps some other steps could have been taken. With regard to the new shares, when it was mooted about winding up, the directors desired to return the new shales. It was not until the following meeting that they found they could not do so. It was a source of deep regret to the directors when they found that a legal difficulty arose. Had they seen that the works could not be carried on they wonld not have allowed the shares to be issued. With regard to the value of the security held by the directors, it might or might not.be worth £4400. The directors, at any rate, would be glad to be relieved of it. The real difficulty was the raw material. If farmers would not grow linseed on good land they could not expect good fibre. If the shareholders were prepared to come boldly forward the works could still be.* carried on, but without capital was impossible. The Company started with too small a capital, and this, ' as in nine-tenths of the. local industries entered upon in the colonies, was one of the causes of failure. Dr Hayes would like to know if the fibre was destroyed in the retting. Mr Fostlethwaite said that the last year’s fibre was of such an inferior quality that it could not be used for twine. The machine bad been purchased before the flax complained of was on the ground. A long discussion ensued, in which a lot of old ground was traversed. Dissatisfaction was expressed at the action of the directors concerning the new shares, but subsequently the position of the matter was considered satisfactory. Dr Hayes said he was one of the unfortunates who bad taken up shares under the impression that matters were going on comfortably. They should not be hard on the directors, who were, like themselves, heuvi'y hit. What they had done had been in good faith, and shareholders should certainly exonerate them from any attempt at “ having *' them. < The Chairman explained that the advantage of going into liquidation voluntarily was that they coaid appoint their own liquidators, which wOuld be a more satisfactory process and loss costly than allowing the Company to become bankrupt. After some further questions, bad been replied to, the resolution wan put and carried by 14 to 3. ' Mr Brown then moved, and it was carried the assets and . liabilities of the Company be forwarded to each shareholder before the next meeting, which will be held in fourteen days to confirm the present resolution.” Ho also suggested that the directors! carry on the works, if possible. The meeting then terminated after passing a vote of thanks to tho Chairman.