Australian Opportunities
It is disappointing that the Treasury have re fused to allow NEW BROKEN OWL to transfer its domicile to Australia, although both its business and its management are situated in Australia. Bound by English taxation the dividend will now cost the company an extra £671,000, although this will be offset by transitional relief of £370,000. Clearly the best way out of this debacle is for RIO TINTO ZINC to take the company over, which is not impossible. The shares have tem- porarily fallen and are presently quoted at 37s. to yield 101 per cent. 1 would certainly not advise selling but I would draw attention to NORTH BROKEN HILL which being registered in Australia is capitalised in Australian currency. This com- pany has increased its dividend to 25 per cent out of earnings of 45 per cent and at the present price of 27s. the 'A' 10s. shares yield 7l per cent without allowing for Australian withholding tax of 15 per cent. This company has an investment port- folio of $16.4 million. and in addition has a 32t per cent interest in the oil prospecting com- pany — Beach Petroleum- - and a 12 per cent in- terest in the great new aluminium company formed in partnership with the Aluminium Com: pany of America. These Australian lead-zinc mining companies are a line hedge against cur- rency risks and even Rio Tinto Zinc at 33s. 3d. to yield 5.3 per cent is not to be ignored on that account. •
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