Honolulu star-bulletin. [volume] (Honolulu [Oahu, Hawaii]) 1912-2010, 1912-09-25
S. P. MAY SELL OIL
COMPANY TO
union
Report That Associated Con.
Germ Is To Be Acquired
Soon

nat leSOlldllOuS are ptIluluS IpI
the acquisition of the Associated oil
by the Union Oil Company of Califor-
MIA is the story that has been re-
ceived with much interest in Homo
lulu, where the Associated, the Union
and the Standard are all heavily in
terested, as we'll as throughout the
islands.
According to this story matters
have reached such stage that &C.
tual contamination of the deal, which
will be one of the largest put through
in years, is expected any day.
The Associated Oil is controlled by
the Southern Pacific Company, which
owns $2O,069,O00 of the S40,O0O,0OO
worth of outstanding common stock.
The Union Oil Company of Califor-
MA has an authorized capital of $780,
900, 900, so that the amalgamation of
these two concerns will result in the
establishment of probably the great
est competitor the Standard ever had.
Just what the terms Of the consoli-
dation will be cannot be learned. but
it is said on the coast that the pro-
posal being considered involves turn
ing over a large amount of cash to
the Associated Oil interests.
Setback to John DIS Concern.
Acquisition of the Associated by
the Union will not be relished by the
Standard Oil, which has had it's eyes
on the Union property for years, but
was afraid to take it over, lest such
action stir up public mitigation and
excite further attacks on the COM
pany by politicians, says one report
from California.
Interests controlling the Union have
considered the advisability of acquir-
ing the Associated for a long time.
The Union people entered into extend
ed negotiations about a year ago, with
a view to absorbing the property, but
these negotiations were broken off be-
cause there was a divided opinion
among the leading stockholders of the
Union about the wisdom of carrying
it out. .@
More recently, though, the scheme
has been looked on with increased
favor.
S. p. Willing to Sell.
1t is understood that the Southern
Pacific Company is willing to partI
with the Associated because of the in
creased pressure being brought by the
On railroads owning in
terests other than those doing trans |
portaticn business. -,-..
Action by the government in fore
ing the coal railroads to segregate
their coal properties, together with
the passage OF the Panama Canal en-
actment, which directs the railroads
to divest themselves of their steam
ship properties, is accepted as fore |
runners to a demand that railroads |
interested in oil companies dispose of
them also.
Another reason why the Southern
Pacific might allow the Associated to !
go TO the Union is that it is not re- |
ceiving any dividends on its $2O,06a,-
900 worth OF shares. Dividends of :
$3.50 were paid on February and |
August l, 1906, February L and March |
I, 1907; but none has been declared
since then.
Union a Sea Concern.
The three largest oil companies in |
California are the Standard, the Asso- |
ciated and the Union. All are COLI
petitors in the full sense of the word.
The Union is engaged mainly in
deliveries of Oil by sea. It's refining
operations are small compared with
those Of the Standard.
The Associated Company's business
is mostly the sale of fuel oil delivered
by rail. 1t occupies the strongest po-
sition in that field because of it's alli- !
ance with the Southern Pacific.
Standard OILS stronghold is it's
favorable position for the sale of re-
fined products and their distribution.
This concern has ordered the con-
struction of a number Of new ships.
This may be a preliminary counter
based on the knowledge of
the forthcoming absorption of the As
ISOLATED by the Union.
Control of the Union is held in Los
Angeles, so that the announcement OF
the consummation of the impending
deal must come from there.