FOHO-126/08
00 F C 0
600
CYPHER CAT/A
FM HONG KONG 280800Z
RESTRICTED
RECEIVED IN REGISTRY NO:32:
28 MAY 1974
HKK2/2
124
RIDE [HRIOD
HK Govt Office
Com
TOP COF
TO IMMEDIATE HONG KONG GOVERNMENT OFFICE LONDON TELNO 259 OF 28 MAY (F C O PLEASE PASS).
FOR KIDD FROM YEUNG.
[PASSED BY C.O.D.}
hous
if
D.I.B. 9 June
ar (63)
PA
2. THE F.S. HAS SETTLED WITH CALDECOTT OF KLEINWORT BENSON AND LAUNDER OF WARDLEY THE TERMS AND CONDITIONS UPON WHICH THESE TWO MERCHANT BANKS WILL ACT AS FINANCIAL ADVISERS TO THE MASS TRANSIT RAILWAY PROVISIONAL AUTHORITY.
3. HE HAS ASKED THAT THE TERMS AND CONDITIONS BE PUT TO THE PROVISIONAL AUTHORITY FOR ENDORSEMENT AT ITS NEXT MEETING ON 3 JUNE AND THAT AN ANNOUNCEMENT BE MADE IMMEDIATELY THEREAFTER,
4. 1 WOULD BE GRATEFUL IF YOU WOULD CONTACT CALDECOTT OF KLEINWORT BENSON (20 FENCHURCH STREET EC3) AND ASK HIM WHETHER HE WOULD HAVE ANY AMENDMENTS TO MAKE TO THE FOLLOWING DRAFT
PRESS RELEASE
FORMATION OF FINANCIAL MANAGEMENT COMMITTEE AND APPOINTMENT OF FINANCIAL ADVISERS TO THE MASS TRANSIT RAILWAY PROVISIONAL
AUTHORITY.
THE MASS TRANSIT RAILWAY PROVISIONAL AUTHORITY ANNOUNCED TODAY THAT IT HAS APPOINTED TWO MERCHANT BANKS, NAMELY, KLEINWORT, BENSON LIMITED OF LONDON AND WARDLEY LIMITED OF HONG KONG, TO BE ITS FINANCIAL ADVISERS IN PLANNING THE STRATEGY FOR RAISING HONG KONG DOLLARS 2,000 MILLION FOR THE MASS TRANSIT RAILWAY PROJECT.
IT WILL BE RECALLED THAT THE LETTER OF INTENT ENTERED INTO BETWEEN THE HONG KONG GOVERNMENT AND THE JAPANESE CONSORTIUM IN FEBRUARY 1974 PROVIDES FOR A CONTRACT TO BE NEGOTIATED FOR THE BUILDING OF THE FIRST FOUR STAGES OF THE MASS TRANSIT RAILWAY AT A FIXED PRICE CEILING OF HONG KONG DOLLARS 5,000 MILLION. OF THIS SUM, APPROXIMATELY THREE-FIFTHS IS TO BE RAISED BY THE JAPANESE CONSORTIUM IN THE FORM OF EXPORT CREDITS. THE REMAINING TWO-FIFTHS, AMOUNTING TO APPROXIMATELY HONG KONG DOLLARS 2,000 MILLION, HAS TO BE RAISED, INITIALLY BY THE MASS TRANSIT RAILWAY PROVISIONAL AUTHORITY AND LATER BY THE MASS TRANSIT RAILWAY CORPORATION, BY SECURING LOANS FROM THE INTERNATIONAL MONEY MARKET IN THE THREE YEARS 1975-76 TO 1977-78.
THE TWO BANKS WILL PROVIDE THEIR SERVICES THROUGH THE APPOINTMENT EACH OF A REPRESENTATIVE WHO WILL WORK FULL-TIME WITH THE PROVISIONAL AUTHORITY. IN ADDITION, THE PROVISIONAL AUTHORITY HAS AGREED TO APPOINT A FINANCIAL MANAGEMENT COMMITTEE
TO OVERSEE THE PLACING OF LOANS ON THE INTERNATIONAL MONEY MARKET
AND TO WORK OUT LOAN-SERVICING ARRANGEMENTS. THE COMMITTEE WILL
CONSIST OF THE FINANCIAL SECRETARY AS CHAIRMAN AND THE FOLLOWING
AS MEMBERS
MR M.G.R. SANDBERG
THE DEPUTY CHAIRMAN OF THE HONG KONG AND SHANGAL BANKING
CORPORATION.
A MEMBER TO BE NOMINATED BY THE HONG KONG AND SHANGHAI
BANKING CORPORATION.
MR BARNETT OF KLEINWORT, BENSON LTD.
A MEMBER TO BE NOMINATED BY WARDLEY LTD.
MR LAU WAH-SUM, THE ASSISTANT FINANCIAL SECRETARY (MASS TRANSIT STUDIES).
THE CHAIRMAN OF THE MASS TRANSIT RAILWAY CORPORATION (WHEN APPOINTED).
THE COMMITTEE IS EXPECTED TO BE FORMED SHORTLY AFTER THE
ARRIVAL IN HONG KONG IN EARLY JUNE OF MR BARNETT OF KLEINWORT, BENSON LIMITED.
MACLEHOSE
08272
2
12.41
NALAHT