THE P. AND O. COMPANY.-4---WHAT THE PURCHASE OF THE BLUEANCHOR LINE PORTENDS.(By "Nauticus.") Not since Mr. Pierpont Morgan and hissyndicate of American capitalista, in 1901,acquired the controlling interest in theWhite Star, Leyland, Dominion, Beaver,and other lines, chiefly engaged in theNorth Atlantic trade, and Mr. (now SirJohn) Ellerman, having relinquished hisinterests in the Dominion Line, broughtabout an amalgamation of the Leyland(Mediterranean), Papyannia, Hall, and CityLines, concerned with the Levant and Indian trade, has an event of such importancein the British shipping world been announced, as the brief cable in the "West Australian" of Saturday morning, indicatingthat the Peninsular and Oriental SteamNavigation Company had acquired Lund'sBlue Anchor Line of steamers. So far as the general public is concerned the newscame in the nature of a genuine surprise,and the same may be said of the shippingcommunity, though the few in Australiawho were cognisant of what was proceedingmanaged to keep the secret remarkablywell. Sir Thomas Sutherland, in his addressto the shareholders of the P. and 0. Company, at the annual meeting last December, dropped no hint as to the sensational policy of development which was practicallyto mark the opening of the new year thenso close at hand. That address contained a brief review of British shipping, a detailed explanation of the business of theP. and O. during 1939, a dissertation orthe social changes governing passenger,and consequently the nature of accommodation provided for them during the lastquarter of a century, and a statement asto how the P. and O. had been led into thetourist traffic, and incidentally how profitable a venture it had turned out to be. Itwas somewhere about 1896 that a moveon the part of the P. and O. Company ledto much comment, and most of is not atall favourable to the concern. Traveller and shipping men are all familiar with theClan Line. Fourteen or fifteen years agothe vessels of this company enjoyed a largeand growing share of the Indian passengertrade. During the outward season thesteamers, which sailed from the MorpethDock, Birkenhead, always carried a fullcomplement of passengers bound for Bombay, Madras, and Calcutta. Greater thingswere expected from the Clan Line, and itwas felt that what was described as the"P. and O.'s grip on India" would be relaxed. All at once the newspapers reportedthat an arrangement had been come tobetween the P. and O. and Clan Lineswhereby the latter had decided to do awaywith the carrying of passengers and restrict themselves entirely to cargo. Herewas a bolt from the blue. Precisely whatfreight quid pro quo the Clan Line receivedis a matter the public know not, or arelikely to know. This Clan Line arrangement may be regarded as the first move of what can be termed the policy of external expansion adopted by the P. and O. Six years agothe company began to devote attention tothe carriage of freight, and the magnificent10,000-ton steamers of the Pera and Palermo clans were built. India, the Far East and Australia were all embraced in the freight area for which these ships hadbeen designed. Here success was immediate. It is not. necessary to make more thana passing reference to the inception of thetourist business, with the transference ofthe well-known Australian mail steamerRome into the cruising yacht Vectis, or theopening by the company last year of anoffice at 281 Fifth-avenue, New York, withMr. I. J. Garcey as agent. Each move from the Clan Line agreement pointed inone certain direction. Sir Thomas Sutherland last month said, "We may not be the largest British line, but we are thewealthiest." The accretion of tonnage bythe absorption of the Blue Anchor Line,placing that at 40,000 tons, will bring thetotal P. and O. tonnage up to close on halfa million, and will place it first of all theBritish-owned lines in the world on thebasis of tonnage, if not of ships. And nocompany has ever been more favourablysituated financially to embark on an important venture such as this purchase of theLund fleet undoubtedly is. Last year the company made a profit of £655,780. Ittransferred £375,288 to depreciation fund,apportioning the greater proportion to thepayment of a final dividend of 13 per cent.for the year, and carrying the balance of£66,488 forward to the current year. Andthe figures quoted by Sir Thomas Sutherland of the company's assets are striking: Sundry balances, £1129,078; fleet of ships,£3,901,556; fleet of tenders, £119,580; cashinvestments, £2,938,666. And how carefullythe business of this great concern is conducted, and what an eye to the future is displayed may be understood from the fact that the company's fleet stands at a gross cost of £10 Is. 10d. per ton. Nowdeducting reserves their net value is £6 4s.2d. per ton. As the tonnage embraced inthis statement is 400,017 tons a very fairestimate of the strength of the company inthis particular alone can be formed. The purchase of the Lund fleet is at anopportune time. The mystery of the Waratah is an incident that, in view of popularprejudice and sailors' omens of ill-luck, haspossibly played an important part in thefortunes of the corporation. Indeed theWaratah's disappearance may have acted soprejudicially in the future that as a passenger concern the Lund Company might becompelled to withdraw from competitionbecause of the comparatively littletrade offering. And it is not unlikely that those upon whom the workof carrying on the business whichCaptain William Lund founded in 1851,realising how powerfully prejudice can actto the detriment of a shipping concern,decided that the best thing possible wouldbe to sell the entire fleet and connection,lock. stock, and barrel. Whether they wereso actuated or not is a mere matter ofspeculation. That they have sold out is afact. And what further part is the P. andO. now to play in the trade of the Empire?The surmise is that the company's extendedservice will embrace a route to Australiavia the Cape. This surmise is reasonableenough; but may not this further conjecture be hazarded that the White Star Line, an American-owned concern, will be shortlyfaced in Australian and Cape waters at allevents with an opposition worthy of thename? That the White Star Line has donemuch for Australian travellers none willdeny. But it may be affirmed that if theP. and O. proceeds to conduct a popularcheap service to Australia via the Capethat service, from every standpoint, willbe superior to the White Star, excellent asthat admittedly is. Future developments are sure to be followed with the greatestinterest. The enlarged scope of the P. and O. work will result in the centering in London of all the best men the company possesses. Mr. F. G. Allen, the agent at theimportant port of Colombo, has just beencalled to London. He is certainly one of the ablest men in the company's employ, and to him is due, in a great measure, theexcursion tickets issued at present betweenCeylon and Australia. The P. and O. commences its seventy-second year of incorporation most auspiciously, and all who takea pride in the maintenance and expansion of British shipping will rejoice that the British flag will not pass from one servicewhich the old owners have decided to relinquish. After the loss of the Waratah, the Blue Anchor Line suffered a significant drop in ticket sales, forcing the Lunds to consider the sale of their vessels to the P&O Line. 40 000 tons of Blue Anchor Line vessels subsequently flew the P&O flag, enhancing and building on the trade between the UK and Australia via the Cape. The Lunds received 275 000 pounds for the sale and faded into obscurity. The P&O Line on the other hand went from strength to strength, becoming what it is today.