[Trade Journal]
Publication: The Glassworker
Pittsburgh, PA, United States
vol. 41, no. 33, p. 9, col. 1-2
BIG AUSTRALIAN BOTTLE COMPANIES IN MERGER
New Concern Named Australian Glass Manufacturers Co., Ltd., to Control
Bottle-Making in Antipodes. Plan to Make Sheet Glass Also.
The event of the year thus far in the glass industry of Australia has been the amalgamation of the Australian Glass Manufacturers Co., Ltd., and the Zetland Glass Bottle Works, Ltd. These two concerns, which have been the largest factors in the bottle industry of that far-away empire-continent since 1919, will virtually, control the bottle industry in the Commonwealth and the bottle market in Maoriland (New Zealand).
The amalgamation, according to the Sydney Bulletin, has brought about the Amalgamated Glass Manufacturers Co., Ltd., with a nominal capital of 2,000,000 pounds, of which about one million will be paid capital. W. J. Smith, who might be called the "bottle company amalgamator" of Australia and the founder of the Zetland company, is managing director of the new concern which starts with an excellent equipment and with practically all the big contracts worth having in the Antipodes in its grasp.
According to the Sydney newspaper, the A. G. M. proposes also to manufacture sheet glass sufficient for the requirements of the Commonwealth of Australia, but up to February 1 no sheet glass had been produced.
In 1915, W. J. Smith organized the first A. G. M. company by bringing together the Melbourne Glass Bottle Works, Ltd., which had been started in 1872, with the Waterloo Glass Bottle Works, Ltd., and Vance & Ross, both of Sydney. It established or had factories in all states except Westralia and, after introducing modern methods of bottle manufacturing, began a remarkably successful career. On a paid capital of 276,000 pounds the company averaged up to March, 1919, profits of about 22,000 pounds per annum. For 1920, profits were 51,106 pounds. In 1921 when the capital had grown to 442,489 pounds, the profits were 65,524 pounds. To finance further extensions, the company issued in 1921, 175,000 pounds worth of nine per cent. cumulative preferred stock which was sold immediately.
In 1919, Mr. Smith, who had withdrawn from the management of the A. G. M., organized the Zetland Glass Bottle Works, Ltd., in Sydney. It was backed by powerful interests and had a meteoric rise. With modern glass-blowing methods it made good profits and to carry contracts taken increased its nominal capital within two years from 15,000 pounds to 250,000 pounds.
It is these two companies which have joined hands under the direction of Mr. Smith, the guiding spirit in the formation of both. The Sydney Bulletin, in discussing the prospects for the amalgamation, said in a recent issue:
"The management will be able to estimate fairly accurately the profits for about five years; and as they are expected to show an improvement on those earned by the old companies — a saving should be effected by concentration and on overhead charges — it is not surprising that the Zetland directors, recommend the amalgamation to their share-holders as ensuring one of the soundest and most lucrative investments. An investigation of the affairs of the two amalgamating companies considered in relation to the contracts (running into some millions) on hand, suggests that dividends even better than the 10 per cent. which had been paid by both should be possible if all goes well. It was probably the anticipation of improved profits which led the promoting companies to leave so many unissued shares at command. The market is not likely to see much of the scrip; the concern is partially co-operative; practically all the big bottle-users are substantial holders and the other shares (apart from the preferred issue, of course), are not widely distributed."
