Thursday's developments with reference to the Shanghai Manufacturing Ca. Ld. were of the greatest importance and interest.
Tt will be remembered that tne agents of the company, following upon the judgement in H. M. Supreme Court, issued a notice calling an extraordinary general meeting to consider a resolution that the company be wound up, and that Messrs N. Thomson and S. Wilkinson be appointed liquidaters. The effect of the carrying of this resolution would be, roughly, that the business would be for sale.
Thursday's news was to the effect that a strong syndicate had been formed, the intention being to buy up the company and retain it as a British concern. This, according to the new Order in Council, would necessitate the resignation of the Mitsui Bussan Kaisha as managers of the company.
The financial backing of the syndicate is considerable, and it may work in one of two ways. For instance, between now and the date of the extraordinary meeting st may be able to purchase sufficient shares in the market to obtain a majority and thus prevent the company being wound up. In this event, a change of managership would have to follow. If this course is not followed, or the syndicate finds itself unable 10 purchase a sufficient number of shares, it might start operations after the winding up and enter the the market as a purchaser of the business. In any event the situation is full of interest, and will be watched closely.
The strength of the syndicate may be gauged by the present value of Shanghai Cotton shares. While the capital of the company is Tls. 2,000,000, its Tls. 50 shares are at present standing at nine times that value, giving a present value to the company of Tls. 18,000,000. The shares have not visibly changed in price between the December settlement and to-day, whereas it is a noteworthy fact that almost all other cotton shares have shown aa appreciable increase. It is sug gested that this is due to the new Order in Council calling for the British management of British companies, which naturally introduced a somewhat uncertain factor into the company's future. At present values, therefore, it is quite likely that the sum of Tls. 18,000,000 does not actually represent the prices which in other circur.stances the shares would fetch, and this fact indicates the great strength of the newly formed syndicate.
Text read from the printed page and cleaned; old type leaves the occasional error.