New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1915-06-30
$4,000 |. {. 5.
INVESTORSOU
OVER $7,5O0,O0O
These Persons of Small
Means Scattered from
Coast to Coast.
STOCK SOLD AT $3.50;
NOW QUOTED AT $50
Bankers Control Helps Scranton
by Insuring Life of
Schools.
from stan Correspondent, o, The Tribune.

tFrom stan Correspondent or inc lrDuneI
Scranton, Penn, June 29.-The
change in the management of the In
ternational Textbook Company, by
which that S10,000,000l corporation,
owner Of the international Correspond
ence School, passes from the hands of
7. J. Foster and his associates to those
Of local bankers, affects Scranton lit
tie, for most of the thirty-fve thou
sand stockholders, who bought their
stock at an average price of 125 or
better, do not live in Scranton.
In the main the stockholders are per
sons of small means-clergymen,
school teachers, small tradespeople and
factory employs who, to earn little
more for their savings than banks
would pay, bought one or more shares
OF stock, often on the instalment plan.
They are scattered from coast to coast
and from lakes to Gulf.
The stock, for which they paid from
1875 to $50, and which one year ago
was salable at las, was to-day offered
at go, with 30 bid, and very few offer
ing to take it at that price. Stated di-
ferently, stock for which they paid ap-
proximately s12.5)0,000 may be salable
for $4,000, 900 now. -.
Under the new management, which
proposes TO squeeze the water out Of
the property, it will be several years
before any dividends will ne paid. For
years the company paid 10 per cent
annually, making the yield to those
who bought il in excess of 6 per cent
as compared with 4 per cent, the rate
usually paid by savings banks.
Beneficial for Scranton.
The effect on Scranton. except in the
case of the higher paid officials of the
company, is good. for the worry lest
the big school plant. which employs
$500 hands and has a payroll of ST.
100000 year, would be forced to close
down Is over. The number of en-
ployes may be reduced somewhat, but
the continued existence of the school
here is assured. here is also an as
surance that plars of those who had
been in control OF the company to eX-
tend the school work in other places
will be abandoned for the present, and
when it is decided to extend the work
it will be managed here.
The plan. which for the present at
least has been abandoned. called for
the creation OF another company to
handle a new department. This COM
pany was to have issued S20,000,000 in
stock. most Of which if not all would
have gone into the international Text
book Company's treasury with which
to pay dividends. Just as the Interna-
tional Educational Publication Com
pany. another S20,000,000 company,
formed to handle the foreign business
of the company. was turning money for
dividends iato the textbook company's
treasury until the European war
stopped the sale of the stock and the
operations Of the company abroad.
What will become of other corpora
tons in which Foster, who is the father
OF the correspondence school idea, and
his associates have been in control is
one question the local bankers will not
for the present bother with. The CAPT
talization OF these companies runs into
the tens OF millions and they include
everything from chicken farms in New
Jersey to fig farms in California and
coal mines in West Virginia.
Companies Unsuccessful.
One of the most important of these,
the Lackawanna Coal and Lumber Com
pany, is in default on its bonds, while
another company is in the hands of a
receiver.
Stockholders of these companies are
very largely stockholders in the Inter-
national Textbook Company, originally
formed to take over the famous Inter-
national Correspondence Schools. and
many are students or former students
in the school. 1t was the practice of
the textbook company 70 maintain a
force TO sell stock, as well as school
courses, and both stats canvassed the
students, who were also canvassed for
stock and bonds in other Foster COM
panies.