Table 10: Hong Kong Cotton Spinners' Attitude Toward Private and Public Forms of Company Organization
Company Organization Number Percentage Private company 16 46 Public company 15 43 No preference 4 11 No answer 0 0 TOTAL 35 100Source: Interviews, 1978.
Those favouring the private mode believed that it was best to raise industrial capital from their own resources so that profits would return to them. They were suspicious of the motives of the companies that have gone public. Listen to the younger brother of the major owner of Mill 32:
'Whenever the question of going public is mentioned, tears will fall from my brother's eyes. "Why should we give away our hard-earned money", he says. For the ambitious, they should have their shares floated. But most of them just want to take advantage of the public. We don't want to do that.'
Some directors of public spinning companies would rather revert back to private ownership. As B17 said,
'In Hong Kong's environment, the private form is better. The stock market is very abnormal with too much speculation. We try to avoid people who are after a quick buck.'
His underlying concern, I suspect, was the risk of take-over by other companies so that the original owners' assets could not be preserved. Spinning mills usually went public as an expediency mainly because bank loans will be more forthcoming. Banks were eager to have a closer watch over the operations of their clients, and the published accounts of public companies are a useful means of control. Partnership and joint ventures also frequently adopted the public form for greater legal protection and mutual supervision with the help of independent accountants.