The slump in world trade contributed to the down fall of Lord
Kylsant, as Owen Philips was now known as having been elevated
to the peerage, and by 1929 he was experiencing financial problems.
It was group policy that each company should make a return of
5% on capital employed although the bank rate was around 3%.
Profits were used to expand the group unnecessarily and to prop
up lame ducks such as the White Star Line. Companies failing
to meet the 5% target had to top up the difference out of reserves
and when they were exhausted by mortgaging their ships against
bank loans. New ships were financed by loans but the 5% took
precedent over repayment of the loan, a policy which works well
when trade is expanding but disastrous in times of recession.
Eventually the group was unable to repay Government loans made
available for the construction of ships under the Trade Facilities
Act.
In 1930 a Government enquiry recommended that
the Kylsant Group should negotiate with its bankers and raise
funds to repay the loans but when, by July of the same year,
nothing was forthcoming Lord Kylsant was divested of his powers
and the group put into the hands of three Trustees. By 1931
the Kylsant empire was bankrupt and the affairs of the group,
which included Union Castle Line, White Star Line, Elder, Dempster
and both Glen and Shire Lines had to be unraveled, a complicated
but not impossible problem. Lord Kylsant was found guilty of
making fraudulent statements to attract working capital.
A Board of Trustees was set up to administer
the companies as going concerns and, fortunately, Glen Line
was relatively unaffected as its operations were separate from
the rest of the group. Although the company owed very little
to its creditors there was no capital and cash in hand was in
short supply. Its ships had been mortgaged and the proceeds
siphoned off by Head Office and the only way forward was for
the Trustees to negotiate bank loans which were partially underwritten
by the Government.
The Chairman of the Board of Trustees was
Sir Richard Durning Holt who was also the head of Alfred Holt
& Co - Blue Funnel Line. By re-capitalising Glen Line at
market value Holts purchased the shares of the company including
Shire at an agreed price and the proceeds were used to pay off
Preference share and Debenture holders. Royal Mail, the Ordinary
shareholders, received nothing. With secured loans and trading
debts also being underwritten by Holt's the Government were
satisfied that Glen Line had been successfully extricated from
the Kylsant debacle and was in safe hands. Holt's similarly
rescued Elder, Dempster in the following year.
Under new ownership the company continued
to be managed by Cameron McGregor, grandson of the founder,
and Ernest Hills who transferred from the Shire office. Head
Office remained at 20 Billiter Street, London but registry of
the ships was transferred to Liverpool where Alfred Holt &
Co. was based. The first problem confronting the Holt Group
was the need to replace some of the Glen vessels as there had
been no additions to the fleet during the previous twelve years.
A precendent was established which was to continue throughout
the remaining years of the companies whereby ships were transferred
between the fleets, reliveryed and renamed. The first two to
undergo the change were Blue Funnel's Elpenor and Machaon who
were give the Glen Line red funnel and renamed Glenfinlas and
Glenaffric respectively. The arrival of these two vessels in
1935 released the ageing Pembrokeshire and Carnarvonshire which
were duly sold.
In 1936 the Alfred Holt Group laid down plans
for modernising both the Blue Funnel and Glen Line fleets. A
larger class of ship, considered to be the finest ever deployed
on the Far East routes, was designed and, because a quick delivery
was required, orders were placed with five different shipyards.
A new Managing Director, Mr C.E. Wurtzburg, was appointed in
1937 to lead Glen into this period of growth. Wurtzburg had
worked with Alfred Holt & Co. for some seventeen years and
had been the Chairman of a subsidiary company, Straits S.S.
Co.
Eight ships of the 'Glenearn' class were ordered
to operate a twice monthly service but only the Glenearn, the
Glenroy and the Denbighshire were completed before the outbreak
of the Second World War. Because of their advanced design, speed
and operating range, seven of the vessels went immediately to
the Royal Navy on completion during 1939. The Glenearn, Glenroy
and Glengyle were used as large infantry landing ships and the
Denbighshire, Breckonshire, Glenorchy and Glenartney as fast
supply ships. The latter four vessels participated in the famous
Malta convoys which kept the island supplied with food, oil
and weaponry thus preventing it from being invaded by the German
forces. The eight member of the group, the Glengarry, was captured
when the Germans invaded Denmark , where she was being fitted
out, in 1940. Although converted for military use she was seldom
used by the German Navy.
During 1942 the company lost three ships
as a result of enemy action. Flying the White Ensign, H.M.S
Pembrokeshire was lost in the March while entering Valetta Harbour,
Malta after strenuous convoy duty. The Glenshiel was torpedoed
by a Japanese submarine off the Maldive Islands in April and
the Glenorchy was lost while forming part of Operation Pedestal
the most famous and vital of the Malta convoys.
After the cessation of hostilities it took
Glen Line eighteen months to return to full commercial operations.
During the latter end of 1945 non combatant vessels were used
by the Shipping Controller as supply ships and for general tiding
up duties and when they were released in 1946 priority in the
overcrowded and overstretched shipyards was given to the refurbishment
of food ships.
Consequently, it wasn't until 1948 that the
refurbishment programme was completed and the fleet then consisted
of the Breckonshire, the Denbighshire, the Glenafric, the Glenapp,
the Glenartney, the Glenbeg, the Glenearn, the Glengarry, the
Glengyle, the Gleniffer, the Glenogle, the Glenroy, the Glenstrae,
and the Glenorchy which had spent the war as the Priam. The
ages of the vessels ranged from 33 years to 6 years, a mixture
of old and new vessels. As it was necessary to maintain a regular
fast service out of London some of the older ships were transferred
to Blue Funnel in exchange for the Radnorshire which reduced
the fleet to 9 ships. The pre-war fleet requirement for the
service was eight but war damage slowed loading and unloading
in some ports and the extra vessel became a requirement. By
1949 Glen Line had been transformed into a company operating
a fleet of extremely well equipped and fast class of sister
ships.
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