|
THE NORTHWARD EXPANSION 447
say
that the current price of zinc is as surprising as it is disappointing,
because intrinsically the position of zinc is almost sounder than that
of any other base metal. Not only are all the important producers
working in concert with one another, but the known reserves of zinc are
comparatively small, while the quantity of metal in stock is not more
than three months' consumption.
Towards
the end of 1935 the difficulties with which the Broken Hill company was
struggling led to an extremely delicate situation between Edmund Davis
and Ernest Oppenhcimer. The former was both, deputy chairman ot Rhokana
Corporation and a director of Rhoanglo and of Anglo American
Corporation, but he had also interests outside the orbit of the Anglo
American Corporation group and he obviously felt free to act for
himself. In any case, he was resident in London and not in South
Africa, and not in constant personal touch with Ernest Oppenhcimer.
Edmund
Davis was faced by two problems. His general manager at the mine itself
was pressing for large-scale developments costing upwards of f 730,000;
at the same time there was an outstanding debenture debt and the
company was over-capitalized. Financial reconstruction was called for.
Edmund Davis wished to pay off the debentures,write down the nominal
value of the shares in the ratio of 1 to 5 and to raise fresh money. On
25 November 1935 he was writing to Ernest Oppenhcimer that he had sent
him copies of his letter to the general manager and also that 'I have
discussed the problem three times with Chester Beatty . . .'. The
Selection Trust group was prepared, 'provided they are given a free
option, to take up the business on the lines I suggested, and of which
you have particulars, but they intend to obtain their own reports
previous to being bound to find the capital'. Moreover, they wished to
alter the constitution of the board. They were to have four members on
the board; Rhoanglo and the 'Chartered' to have one representative
each, while Edmund Davis was also to remain on the board. In other
words, the Selection Trust group would acquire control.
The
first steps taken by Ernest Oppcnheimer were to have the financial
aspects of the proposed scheme examined in his office and to ask Dr.
Bancroft to examine the technical aspects. But the letters and cables
sent to S. S. Taylor and to Anglo American Corporation in London
revealed a mounting degree of resentment. On 7 December he cabled S. S.
Taylor and followed it up by a letter on the 9th. The cable merely
asked Taylor to 'keep in touch [with E. Davis] and advise'. The letter
of
|
||
|
|
||