CO129-470 - Public Offices - 1921 — Page 86

€8

*

τα

4-

shall also relate to the Company's Section and Loan.

84

(m) The two sections shall be worked as one whole and be under

the same supervision.

(n) After the purchase of the Company's Section, the two loans

and two securitics shall be merged into one.

It should be explained that the important part of the

agreement is that relating to the cquisition of the presently

constructed section of the line and we are insisting that the

acquirement áf this section is the first step to be taken.

The constructed section of the line is owned by a

private Chinese Company having a capital of $30,000,000 the Com-

pany also holding a 3/7th share in the Canton-Samshui Line.

The value of the Company's section including rolling

stock and equipment has been estimated at $21,000,000 exclusive

of the interest in the Sanshui Line. The shares of the Company,

however, stand at a considerable discount and it is estimated

that with the exercise of care, tact, and privacy the Line should

be purchased from the present shareholders for a sum of about

$12,000,000.-

The Paking Government are said to hold $400,000,-

worth of stock at par value in the Company.

The Company's line runs through highly developed coun-

try, and, properly managed, should be exceedingly remunerative.

It is, however, grossly mismanaged and is in need of thorough over-

hauling and re-equipment. It is intended to do this out of the

$20,000,000.3 loan.

After the acquisition of the Company's Section it is

to be incorporated with the Constructional Section and the whole

line run under one administration, the Separate Loan and Separate

Securities being then merged to form one.

Mr. Tson has insisted that for domestic-polatical reasons

the/

1