Deals & Developments

Dividends. Wrote Carlton A. Shively, financial editor of the New York Sun last week: "From a speculative standpoint, the market probably would do better if all dividends were omitted at once. Worrying about the tooth is worse than the pulling."

While prices of leading stocks last week continued to reflect worry about dividends, some notable pullings took place. American Smelting & Refining Co. passed its 7% preferred dividend for the first time since the company was formed in 1899; it also passed its 6% preferred. Borden Co. (milk) declared a 50-c- dividend against a previous 75-c- quarterly rate. Public Service Corp. of New Jersey cut wages and dividends by 6%, making the new rate $3.20 against $3.40 yearly. Electric Power & Light Corp. passed second preferred and common dividends despite reported earnings of $9,265,000 for the twelve months ending March 31. Aetna Life Insurance Co. passed its dividend. American News Co. cut its payment in half. General Tire & Rubber passed its preferred payment, as did Associated Telephone & Telegraph, large independent. Another omission was that of Curtis Publishing Co. (Satevepost, Ladies' Home Journal, Country Gentleman) ; and shortly afterward Curtis announced a general 10% advertising rate reduction. Gloomy Chicago was cheered by the announcement that the three big Insull companies will only reduce, not omit, their dividends at the next meetings. Commonwealth Edison and Peoples Gas will pare their rates from $8 annually to $5, while Public Service Co. of Northern Illinois will cut to $3. For the year to June 1 the dividends casualty list has included 422 omissions, 506 reductions.

Kreuger's Diamond. Less than two years ago Diamond Match Co. sold a block of stock to bankers (reputedly Bancamerica-Blair Corp.) for $13,000,000. The block was not heard of again until National City Bank, Bankers Trust, Pittsburgh's Union Trust and Chicago's Continental Illinois announced last May that the late Matchmaker Ivar Kreuger had turned up with it for collateral. They threatened to sell the 3,500 red, crinkly 100-share certificates to reimburse themselves for a $3,800,000 past due loan to stricken International Match. But the numerous protective committees and Irving Trust, trustee for International, clamored loudly for return of the shares, legally obstructed their sale (TIME, June 18). Last week they agreed to the sale if the proceeds were impounded for further wrangling. At the upset price of $5,249,500 the block was auctioned off to the one & only bidder, Diamond Match. President William Armstrong Fairburn must have chuckled softly at clearing $7,750,000 without lifting a hand, at profiting roundly from Ivar Kreuger's blasted dreams.

In Waukegan. On the Lake Michigan waterfront in Waukegan, 111., is the large plant of Johnson Motor Co. which was formed in 1921 to make a 35-lb., 2-h.p. outboard motor. From sales of 3,500 motors in 1922 the company reached a peak of 31.000 in 1929, a figure representing more than half the industry's output. The company now makes five sizes of outboard motors, ranging from the 1 1/2-h.p. single cylinder motor to the 4-cyl., 32-h.p., 116-Ib. Johnson Sea Horse. During the last two years motorboat sales have dropped badly. Last week it was no surprise when the smooth drone of Johnson Motor Co.'s affairs was broken, the firm sputtered, coughed, lapsed into receivership.

Fox Week. In a Washington hotel early last week William Fox, hounded onetime head of Fox Film Corp., still lay ill abed with diabetes, dizziness and a bad cold (TIME, June 27). Though refusing to release him from its subpoena, Senator Peter Norbeck's Banking & Currency Committee finally decided not to quiz him until hearings on stock exchange practices are resumed next autumn (see col. 1). Cineman Fox promptly rose from his sick bed, checked out.

But his woes continued to thicken. Fox Theatre Corp., from which he was ousted in 1930, filed suit last week against Founder Fox, his wife, daughter and four friends, demanding an accounting of profits from alleged manipulations of the company's stock while Fox was in control. Some of the counts had already been aired before the Senate Committee, but he was charged with committing "divers acts of misappropriation and malfeasance," accused of realizing "through unjust and unlawful means and devices . . . large gains of a fraudulent and secret origin and nature." Fox Theatres seeks to recover specifically $2,782,825 from Founder Fox, and by compelling Founder Fox to open his private books hopes eventually to obtain $5,000,000. Prominent among the "divers acts" cited was forcing brokers to hand over a $441,000 share of an underwriting fee to his daughter Caroline Leah Taussig. Immediately upon filing the suit, Fox Theatres went into receivership.

Though the company is not insolvent, officials readily admitted that it did not have sufficient liquid assets to meet current liabilities. Among the fixed assets listed were the claims just filed against Founder Fox, "worth many millions of dollars," and investments in subsidiaries, now in the hands of receivers or trustees themselves, and real estate on which mortgage defaults have been made, totaling $21,360,000.

Unlike many another ousted tycoon, William Fox would probably be able to satisfy the huge claims, if obtained, of the suit now pending. For his majority holdings of the two small voting issues of stock in Fox Film and Fox Theatres he was reputed to have been paid about $18,000,000 cash and a $500,000 annual dispensation until 1935.

This file is automatically generated by a robot program, so reader's discretion is required.