Off the Block

There were few finer catches in the Government's Alien Property net than North American Rayon and American Bemberg Corps. Between them, the onetime partly German-controlled companies made about 8% of all U.S.-made rayon yarn. But North American and Bemberg also proved to be a spiny, troublesome haul. The Dutch Algemeene Kunstziide Unie, N.V. (AKU) complained that the companies really belonged to it. Later the board of directors, representing the minority stockholders, began to complain (TIME, March 8). They wanted the Office of Alien Property to give up its control of the companies.

Last week the directors got their wish, and fast-growing Beaunit Mills, Inc. got a bargain. Highest of four bidders, Beaunit paid OAP $17,111,126 for the Government's controlling interests (some 52% in North American and 45% in Bemberg). Beaunit would probably have had to pay more than three times as much to duplicate the plants at Elizabethton, Tenn.

Among the minority stockholders that will share the companies' future profits (profits last year: $5.7 million) is AKU, which still holds a minority interest. There were strings tied to Beaunit's deal: it may not turn the two companies' rayon yarn into any products made by Beaunit (last year Beaunit made a net profit of 14.4% on $41 million in sales). Also to protect present customers of North American and Bemberg, OAP insisted that the companies continue to supply the customers with yarn for the next five years.

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