Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1911-10-16
Plan for Dissolution Of
American Tobacco Co.,
In Compliance with Decree Of
United States Supreme Court,
Given 0ut..Goes to New York Cir
cult Court, Monday.

| New York, oct. 1.-THE plan for the
| dissolution of the American Tobacco
Co, in compliance with the decision of
the United States supreme court de-
erecting it an Illegal combination, was
officially made public Saturday night
II will be submitted Monday to the
circuit court of the southern district
of New York for approval. 1t was de-
elded TO publish the plan prematurely
owing to the publication Saturday OF
summary Of the plan purportins to
be official, but really incorrect, ac-
cording to DE Lancy Nicoll, counsel
for the company.
The official plan provides for the di-
vision of the American Tobacco Com
pany into four companies. no ono OF
which, it is stated, Will have con-
trolling influence in the tobacco bust
ness. The four companies are the
present American Tobacco Company.
which will continue its corporate eN-
istence; the Liggett q Myers Tobacco
Company, which is to be organized;
the P. Lorillard Company, also to be
organized, and the c. J. Reynolds To-
bacco Company. an existing corpora
ton.
The disintegration is to be brought
aout by selling $115.000,000 of the
property of the American Tobacco
Company. consisting of factories,
brands, businesses and capital stock
| of tobacco manufacturing companies
now owned and controlled by 1t to the
Liggett & Myers Company and the 7.
Lorillard Company for cash and Sc
curties of the two vendee companies
and by distributing to common stock
| holders of the American Tpbaeeo
Accompany two-thirds of the stock OF
the X. Y. Reynolds Company.
The plan also provides for the dlstl-
hutton in the form of dividends of tie
securities of the various subsidiary COM
panies manufacturing lcorice. snuft, I'm
| foil etc. to the common STOCKHOLDERS
and the division of some of these SUD
sidiary companies which were heId
themselves to be Illegal combinations,
| into companies having no interest III
each other. 1t provides further for radl-
cal changes in the voting power oil tne
stock so that the % individual defend
ants. who formerly controlled the Amer
lean Tobacco Company, through the
ownership of &c per cent. of the com
mon stock, will surrender this control.
| The principal financial feature of the
plan is an assessment of si0,2eo, 400 COM
mon stock of the company amounting to
$50, 65i ,9o5. of about 81 per cent. which
will be used toward the proposed retire
ment and cancellation of the company
existing bonds. For this assessment, how
ever the common stockholders will re-
ecive common stock of the LiEgett S;
Myers and +. Lorillard companies.
The net result will be, according to tho
plan:
ITO restore lawful conditions by di-
viding the business in tobacco and re-
lated products heretofore dominated
and controlled by the American To-
becco Co. into companies in which IL
| has held a large, or controlling inter
esa among IA separate and Independent
companies, no one of them having con-
troll or dominance in the trade as 10
any Of the products manufactured by
it. or as to the purchase of raw ma
terial of any kind, no one of them
having any interest by way of owner
ship of stock or otherwise III any OF
them and each of them being a COM
pany. whether now existing or to be
created under the plan in which the
American Tobacco Co. will have no
interest"
In this manner, il is set forth, the
so per cent. of the production of sig
arettes in the United States Will be
divided, 37,i1 per cent. to the American
Tobacco Co.. 27S2 per cent. to Liggett
Il Myers Co, and 1921 per cent. to z.
Lorilard Co. The rs per cent. of smok-
ing tobacco will be divided, 33,0S to the
American Tobacco Co. zoos to the
Llggett e. Myers Co. and 22.S2 per
cent. to the p Lorillard Co. and 2.s6
to the r. j. Reynolds Tobacco Co