THE NORTHWARD EXPANSION 449
Beatty
told me that the business would only be of interest to his group if
they had the American Metal Company's technical service at their
disposal owing to their great practical knowledge of this business.
Further, he offered, if Ernest Oppenheimer were interested in a
financial participation, to arrange something with Chester Beatty when
he comes back from his holiday in Egypt, which will not be until about
the end of March next.
The
idea of further American participation in Rhodesian affairs would
hardly have been pleasing to Ernest Oppenheimer, any more than the
patronizing idea of an indirect approach to Chester Beatty through
Edmund Davis. For the moment he was prepared to give up the contest.
To Edmund Davis himself he wrote on 30 December 1935:
I
quite realize that this company has been a source of great anxiety to
you, and, while I am sorry that we did not have an opportunity of
looking into the business on the terms which have been granted to
Chester Beatty, I do appreciate the position from your point of view,
and for this reason I do not think that any purpose would be served by
discussing this aspect of the matter any further. As regards our
obtaining a participation, I think this can be left over for the time
being, as we ourselves could take the matter up with Beatty at a later
stage if we think it desirable to do so.
This
ended the first phase of the negotiations. The option given to
Selection Trust expired on 30 June 1936; at the beginning of July 1936
Anglo American Corporation in Johannesburg were informed by S. S.
Taylor that the Selection Trust group had not exercised the option on
the original terms, but had made a new offer to Edmund Davis. A
new company with a capital of £1,250,000 divided into 25,000,000 shares
was to be formed; shareholders in the old company were to be offered
one new 15. share for each old 5s. one and further shares at 1s. 3d. to
bring in £227,000 in cash, to be
guaranteed by the Selection Trust. In return for this guarantee
Selection was to be given options over an aggregate of 9-86 million
shares over a period of three years, and if the first of these
options (over 4,000,000 shares) were exercised the Selection Trust was
to take control. With the exception of Edmund Davis himself— if he
chose to remain—the board was to consist entirely of Selection Trust
appointees. In other words, Rhoanglo or Anglo American Corporation were
to be entirely eliminated from the board. The situation was made worse
by an intimation that Chester Beatty refused to give a direct
participation to Anglo American Corporation and the British South
Africa Company, in spite of Davis's 'best endeavours to persuade him'.
