New Engineering Circular to Shareholders Outlining further proposals for] effecting the amalgamation of the New Engineering and Shipbuilding Works, Lid, with the Shanghai Dock and Engineering Ca, Lid, under the litle of the Shanghai Dockyards, td, shareholders of the New Engineering Company on Tuesday, Mar. 31. received a circular signed by Mr. H. E. Arnhold, Chairman of Directors, reporting on the progress of the plans.
The new proposals are aimed at achieving the merger while overcome ing the objections of the preference shareholders, The circular' states.
On October 3 last I addressed you by circular relative to a scheme of merger which after protracted negotiations had been agreed upon by the Boards of the two companies, but required confirmation by both groups of shareholders inasmuch as it alec-~ ted their respective relationship and. rights. Separate meetings for this purpose were called on November: 20 last which became ineffective as the preference shareholders as a class declined to agree to an alteration in the status. of their holdings by an exchange for ordinary shares in the new company with full arrears of interest funded.
Had the resolution succeeded the merger would have taken place almost immediately and the expected economies would, in the meantime have become operative, with the sult that the new company would probably now have been on a profits earning basis.
"Other Methods" Propos 'There does not appear to be any prospect of coming to an agreement fon these lines with the preference shareholders at an early date, and in' the opinion of your Board this should not be allowed to stand in the way of the merger, which they consider to be so much in the interests of both groups of shareholders.
It is therefore proposed to proceed with the scheme' as outlined in my previous circular but by other methods by which each company will retain the shares received from the new company (Shanghai Dockyards Ltd) instead of going into liquidation and distributing them to its shareholders.
On valuations, each company wilt bring into the merger assets of a net mount of $8,800,000, or a total of $17,000,000, "Certain' assets will be excluded by both companies, which 0 far as your organization is concerned will be the s. Ivanhoe, valued' at approximately $335,000, all outstanding sundry debtors, and some readily saleable stocks, the two Jo ter amounting to $252,578, These assets will be utilized in the first place for the liquidation of the overdrafts at our bankers.
The number of shares which each company will receive from the new company (Shanghai Dockyards Ltd.) as consideration for the assets taken over will be 500,000 fully paid ordinary shares of par value. $10 each. Under the scheme the respective rights Jand status of the preference and ordinary shareholders will not be affected,
Text read from the printed page and cleaned; old type leaves the occasional error.