Floating a Company.

Wairarapa Daily Times, Volume IX, Issue 2861, 31 March 1888, Page 3

Floating a Company.

Mr E. A. Harrison Ainsworth has (says the London Echo) rendered a public ael'vice, especially to small investoraj&ho are hungry for large profits, /his gentleman, at the BankCourt, made some interesting -gHwelations as to the way in which Liability Companies are somejgfynes promoted, He was an accountant, and in 1885 converted his business into a company with a capital of 1140,000. The first step was to find an attractive name. Universal Contract Corporation, limited, certainly has an imposing sound, combining the ideas of übiquity, immensity, and solidity. The next stepjwas to find shareholders, and in doing this £IO,OOO was spent in printing, £20,000 in advertising, and £2771 in the postage of circulars and prospectuses. The latter item looks enormous, but it was explained that sometimes 100,000 circulars are sent ouc at one time, on which the halfpenny stamps would cost over £2OO. Everything was done on a magnificent scale, The promoter of the Company was appojfited Perpetual Chairman a ; t £SOOO Wear, and £250 was paid as a special fee to a broker simply for allowing his name to appear on the prospectus. Notwithstanding the fact that the promoter lived on a scale commensurate with the vastness of his Apprise, i.e., at the rate of nearly , JtuOO a year, the business did not \rosper, all its undertakings but three having gone into liquidation, and now the promoter finds himself in the Bankruptcy Court, with assets estimated to be worth LllO, consisting of shares whose" face value" is L 55.000. It is to be hoped thot widows, halfpay officers, clergymen, retired shopkeepers, and others who possess a little spare cash will remember this little story when next they receive flaming prospectuses promising enormous dividends.