CO129-466 - Individuals - 1920 — Page 540

536

To: The Under Secretary of State.

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result of the National Electric Construction Company not proceeding with it, and the extremely adverse financial conditions which existed at this time. Briefly there is an normous demand for capital for already existing dividend paying companies in this Country and at such high pressure have the financial houses been working that it was quite impossible to get reasonable consideration for anything but an already developed company. The only prospect for financing the Boheme was through a construction company, or through the Hong Kong Market. Both these avenues had been closed to the Promotere by the action of the Colonial Government, first, by refusing, without explanation, the National Electric Construction Company, and so militating against the considera- tion of the scheme by similar companies and secondly, by giving such a limited period that it was impossible to make

The satisfactory arrangements for flotation in Hong Kong. Promoters urge that the responsibility for failure to finance the scheme reats entirely with the Colonial Government, first through their objections to the Promoters arrangements, second, to insufficient time being given to make new arrange- ments, thud, by imposing a heavy forfeitable deposit prior to the signing of the agreement, and imposition not contemplated in the original discussions with the Colonial adthorities.

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There remained but one course left for the Promoters to adopt, and that was the promotion of a company in Ebgl and

The sum of £10,000 was arranged to and an appeal to the Public pay the issue expenses, and a first class Board of Directors formed. The Prospectus, Memorandum and Articles of Association were printed newspaper advertisements arranged and set up. and all arrangements made for an issue to the Public on March

At a Board 21st in time to make the deposit by April 2nd. Meeting held in March, the financial outlook was such that the Board decided it would be unwise to make a Publio issue unless the capital was underwritten, and it was found impossible to obtain the underwriting without some support from Hong Kong. necessary steps were taken by telegraph to obtain the under-

was received to the affect writing in Hong Kong, but a reply that financial support from the Colony could not be arranged until the Company was registered and the deposit paid. result, it was too late to go to the Prese, and it was very reluctantly decided that the flotation of the Company before April 2nd, would not be practicable.

As a

The

The Promotere, as a last measure, arranged with friends to provide the sum of £12,500, the then equivalent of the

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