pany
'one of the most influential in the world' and give it great authority
in any discussions relating to the rationing of world output.
Financially, very large amounts had already been invested in Northern
Rhodesia, 'yet much more is required' since the reduction plants
required would have to deal with more than one type of ore. Yet it was
undesirable to raise further sums in such a way as to water down the
shareholders' equity, and raising money by way of loan and debenture
was much easier if the enterprise proposing to borrow had earning
assets which would be the security for such further developmental
loans, and amalgamation would bring such a state of affairs about.
Lastly, the desire of Government to interfere with mining rights was a
perpetual menace and 'the formation of one large company would greatly
strengthen their position vis-a-vis legislation and the government authorities generally'.33
Sir Auckland Geddes had independently arrived at the same conclusion, as he told the shareholders at the same meeting.
As
the world economic situation worsened, my belief in the wisdom of
achieving the largest possible consolidation of the Northern Rhodesian
copper mines strengthened and I set out in some private notes written
to clarify my own thoughts ten reasons which I subsequently used at a
meeting of your board as the basis of my recommendations in favour of
the course proposed to you today.34
33 The full text of this communication is printed as appendix I to this chapter.
34 'i.
That copper is in danger of under-consumption, which will be called
overproduction, for a time to be measured in years!
2.
That the best way of meeting such a situation in relation to the
copper world as it exists today is for the coming production of
Rhodesia to be in as few and as strong hands as possible.
3.
That the best chance of securing a proper share of the world's
supply of copper for the Rhodesian mines is for them to be equipped to
meet something more than their probable share of the supply and for
that equipment to be under the control of organizations self-contained
and assured of adequate financial resources.
4.
That large units would be advantageous in dealing with the
Northern Rhodesian Government as well as conceivably with the British
Government.
5.
That the 'Chartered' company wields great power in Rhodesia, and
that it will be immeasurably advantageous to be in a position of
partner with, rather than tenant of, the 'Chartered' company. This
would in effect be the position under the consolidation before us
today as a result of the 'Chartered' company's very large shareholding
in the Rhodesian Anglo American Limited, the largest single holder of
R.C.B.C. shares.
6.
That consolidation would make it possible, if such a course were
considered advisable or were forced on the company by world
conditions, to secure any given reasonable profit per existing share of
R.C.B.C. and Bwana M'Kubwa in combination with a smaller capital
outlay than would be required to secure the same profit for the
existing shares of R.C.B.C. and Bwana M'Kubwa if the companies remain
separate. As the two companies must draw fresh capital from the same
general sources this has advantages for both. Further, this may
legitimately be regarded as a
