TNAG-0772-FCO40-976-Modernisation-and-electrification-of-the-Kowloon-Canton-Rail-1978 — Page 53

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CONFIDENTIAL

DESKBY 1011662

FM'BTC HONG KONG 101617Z NOV 78

TO IMMEDIATE D.O.T

TELNO.CREDA 334 OF 10 NOVEMBER,

の

INFO IMMEDIATE D.0.1 (FOR BENJAMIN AND DELL).

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Do I (3) Juhl 125 вокуная

FRED (1) Pusy (2)

FOR ROYCE CRE.

NR

YOUR CREDA 112: METCAM AND KOWLOON CANTON RAILWAY.

11

1. I HAVE INFORMED THE PERSON REFERRED TO IN PARA.2 OF MY CREDA 327 THAT METCAM COULD REDUCE THEIR PRICE BY FOUR MILLION POUNDS STERLING, OFF THE CUFF REACTION WAS THAT THIS IS NOT SUFFICIENT TO MATCH THE EUROPEAN PRICE AND THAT THE BEST OPTION MIGHT DE A REISSUE OF TENDERS,

2. 1 POINTED OUT THAT WE WERE WORKING ON OTHER SCHEMES PARTICULARLY IN RELATION TO LONDON TRANSPORT AND THE D.0.1'S ABILITY TO HELP THE LAIRD GROUP. I ALSO INDICATED THAT THE CONCEPTS IN YOUR PARA.2 MIGHT YIELD SOMETHING IF FURTHER EXPLORED.

3. I THINK IT WOULD BE A PITY IF, BECAUSE WE CANNOT GO FURTHER ON PRICE, THE HONG KONG GOVERNMENT FELT UNABLE TO PUSH THE CONTRACT THROUGH ON THE BASIS OF CURRENT BIDS. IT WOULD GIVE

OUR COMPETITORS A CHANCE TO DEVISE FINANCIAL SCHEMES FOR REDUCING THEIR OWN BIDS. LAZARDS HERE SUGGEST THAT CLOSE ATTENTION SHOULD BE GIVEN TO CONCEPT OF BUYER CREDIT SINCE THEY BELIEVE IT WOULD YIELD SUBSTANTIAL SUMS AND THINK THE VIRES PROBLEM IS CAPABLE OF SOLUTION. LAZARDS HAVE SENT A TELEX TO THEIR LONDON OFFICE MAKING CERTAIN SUGGESTIONS WHICH I HOPE YOU WILL BE ABLE TO CONSIDER CAREFULLY. IF YOU COULD INDICATE BY 110960 2 THE DIMENSION OF FURTHER POSSIBLE REDUCTIONS (EVEN VITICUT A PRECISE FIGURE) IT COULD AFFECT THE WAY THE

HONG KONG GOVERNMENT DECIDES TO PLAY THE HAND.

MILLA TE L AK UNLARI E SA -DERLOY THE ARGUMENTS