Attention is called to the letter dated 21st November, 1923 from the Chairman of the Company to Baring Brothers & Co. Limited, giving particulars of the Company, a copy of which is attached hereto, together with a copy of the Accountants Certificates referred to therein. The Report on the Collieries and property of The Denaby and Cadeby Main Collieries Limited and of The Washington Coal Co. Limited which accompanied the Chairman´s letter may be seen at the offices of Messrs., Bischoff, Coxe, Bischoff & Thompson.
Copies of this offer and Terms of Application may be obtained from
BARING BROTHERS & CO. LIMITED, 8 Bishopsgate, E.C.2
London, 22nd November, 1923
DIRECTORS OF THE DENABY AND CADEBY MAIN COLLIERIES, LTD.
Chairman: WILLIAM HERBERT PEAKE, (Chairman of the Airedale Collieries, Ltd)
Directors: WILLIAM DE RALBE. O.B.E.
SIR GEORGE HIGGINS, O.B.E.
(Managing Director of Wm. France Fenwick, & Co. Ltd)
JOHN LESLIE, D.S.O., M.C.
(Managing Director of Wm. France Fenwick & Co. Ltd)
HUGH MORTON STOBART, C.B.E. D.S.O.
(Chairman of the Wearmouth Coal Co. Ltd.)
21st November, 1923
To BARING BROTHERS & CO. LIMITED, LONDON
Gentlemen,
With reference to the purchase by you of £800,000 6 per cent First Mortgage Debenture Stock of The Denaby and Cadeby Main Collieries Limited, I have pleasure in supplying the following information.
This Company owns The Denaby Main and the Cadeby Main Collieries.
These Collieries are both situated near Doncaster on The L. & N.E. Railway Company´s system, and are favourably situated in relation to the shipping port of Hull. The total mineral area amounts to 6,126 acres, of which 880 acres are freehold and the remainder is held under leases having from 22 to 30 years unexpired.
In addition to these Collieries, The Denaby and Cadeby Main Collieries Limited has acquired the entire share capital of The Washington Coal Co. Limited. The latter Company holds various leases over a mineral area of 2,029 acres situated near Newcastle.
The plant and other equipment at all the above properties is thoroughly up to date and sufficient in every way for the handling both expeditiously and economically of an output considerably in excess of that at present being obtained. Mining, which is now being carried on at various levels the lowest being 750 yards, presents no material difficulties and there is no reason to suppose that the development of the properties at still lover levers could not be carried out with equal facility. Ventilation is thoroughly efficient, and the pumping facilities are ample to deal with a considerably greater volume of water than has hitherto been encountered.
The combined output from the above Collieries and The Washington Coal Company, Limited, for the year ending 30th June 1923, amounted to 1,486,244 tons, and it is expected that this amount will be substantially increased as the result of extensive developments now being carried out, which, when completed, are expected to result in an annual output of 1,850,000 tons.
The quality of coal is excellent and is suitable for Gas making, Steam and Household purposes.
The tonnage available from seams being worked is estimated at 68,000,000, but as can be seen from the Valuers Report, there are considerable resources available from other seams as yet unworked.
The proceeds of this issue will be applied to repaying the £206,000 existing Debenture Stock of the Company, to liquidating sundry outstanding loans amounting to £119,892, to the payment of £300,000 being the price of the shares of The Washington Coal Co. Limited, and to the provision of further working capital.
Neither The Denaby and Cadeby Main Collieries Limited, nor the Washington Coal Co. Limited has any Debentures or Loans outstanding other than those mentioned above, which will be liquidated out of the proceeds of this issue
I enclose Certificates by Messrs. Thompson McLintock & Co., Chartered Accountants, showing as at the 30th June, 1923 combined Assets £2,619,229 and Liabilities £706,199, together with combined profits during the 12 years ending that date.
The coal merchanting business of the Company which was transferred to the Denaby Shipping and Commercial Company, Ltd. In 1920 has been re-acquired by the Company as from 1st July, 1923.
The operations of the Denaby and Cadeby Main Collieries Limited for the financial year ending 30th June, 1922, resulted in a loss mainly due to the absence of forward contracts, and to the consequent necessity of selling on an unfavourable market. The loss was entirely provided for in the accounts of the year in question.
I also enclose Report and Valuation on the properties of The Denaby and Cadeby Main Collieries Limited, by Messrs. A.Smith Denton & Co. dated 11th October, 1923 and on those of The Washington Coal Co. Limited, by Messrs. William Armstrong & Sons., dated 12th November 1923.
I am, Yours faithfully
G.H. PEAKE, Chairman
The Denaby and Cadeby Main Collieries Limited.