Allegheny Corp

Always busy are the Van Sweringen Brothers, Oris Paxton and Mantis James. With plans for a railroad merger including Chesapeake & Ohio, Nickel Plate, Pere Marquette, Erie and subordinate roads held up by the Interstate Commerce Commission, the Van Sweringens have been concentrating on financing rather than on operating. Last week they announced and financed a new Allegheny Corp., holding company for their railroad stocks. An offering of $35,000,000 5% convertible bonds, par 100, was quickly sold (through J. P. Morgan & Co., National City Co., First National Bank, and Guaranty Co.) at a 10-point premium. Later offerings were to include 250,000 shares of preferred and 3,500,000 shares of common stock.

Initial holdings of Allegheny Corp. include shares in Chesapeake Corp., Nickel Plate, Buffalo, Rochester & Pittsburgh, Chesapeake & Ohio and Erie, all of which have been Van Sweringen stocks. The corporation is also empowered to make further investments, principally in railroad stocks. It can therefore function as a railroad investment trust as well as a Van Sweringen holding company. It has, however, no power to operate railroad properties or to engage in banking.