Newark evening star and Newark advertiser. [volume] (Newark, N.J.) 1909-1916, 1911-07-25
UNITY or TRUSTS
To Be PRESERVED
BY NEW COMPANY
0ffshoot of New York Bank
Aims to Get Around Dis
solution Order.

NEW YORK, July 25.-As a sequel
to the news that the newly formed Ma
tional City Company an offshoot of
the National City Bank. of this city.
will work for consolidation of the coun-
try's money power. comes information
that the finaneiers back of the Ma
tional City Company are planning to
make hat corporation the controlling
influence in the Standard Oil Company
M the American Tobacco Company.
after those two companies are dis
solved under the recent Supreme Court
DEGREES.
Summarizing the meaning Of the
facts CLEANED the National City CONF
pany. by a complicated but direct con-
troll of the Industrial companies, will
be in exactly the same position as are
the men who control those great COM
binations today.
The present idea. as outlined by one
who is close to several inanciers inter-
ested. is based on the same method on
stock control which was applied in the
formation of the National city Com
pany. That corporation ts a New York
corporation formed under the business
law. and. therefore, outside the juris.
dlctlon of the banking authorities Re-
nounced a 40 per cent. melon was TO
be cut. In other words, a dividend OF
40 per cent. on the banks S25, 600, 900
capital was TO be declared, and stock
holders We're to be permitted with the
dividend to buy harfs of the National
City Company, at par. that concern be-
ing c~apitalizsd at sf0O00,o00,.
1t was advertised. too, that IL the
bank stockholders wanted money in
stead of National City Company shares
they could have 1t, but ii was not In
tended that any OF the stockholders
should ask for money. In fact, II Is
known that In a few cases where money
was asked il was not given. but the
stockholders We're induced 10 accept the
new shares.
To accomplish that it was explained
to them that under the provisions for
the Issue OF the dividend the right TO
dispose of the new conlpany's shares
went absolutely viii the banks shares.
That is, the holder OF 100 shares OF Ma
tional City Bank stock could not dis
pose of those shares without at the
same time disposing Of forty shares of
National City Company stock.
The plan OF i~nterlocking the stock OF
the bank and the National City Com
pany is the one now Il ggested for the
solution OF the trust problem, but IL
will operate in a much more compli-
Gated form.
Under the supreme Court decree the
dissolve. on high authority it has been
said the standard Gil Company viii
separate into thirty-five companies.
and the general expectation he%retofore
panies would be competitors, That
expectation of course was based on the
supposition no method would be found
OF preserving unity. Under the distri-
button plan each present stakeholder
OF the Standard Oil Company viii get
stock representation IN each of the
thirty-1ye companies.
II is suggested now that the unity of
those companies can be preserved by
having their stock interloeked. as is
the stock of the National City Bank
and the National City Company. Under
that arrangement no stockholder will
be able to sell a single share OF any
of the ~thirty-6ve companies with
out at the same time selling the cor
responding stock ratio of lie thirty
-four other companies.