New-York tribune., 1919-01-16
Pabst Company
Proposes Plan
For Liquidation
Owners of Bonds and Pre-
fcrred Stock Asked to Sell
Their Holdings; Step Is
Forced by Prohibition Act

The Pabst Brewing Company, antici-
patlng the coming of nationwide pro-
hibition on July / next, has sent cir
cular letter to its stockholders on the
question OF "Winding up the affairs" of
OF the concert. Plans arc being worked
out, the company has announced, for
the redemption and retirement of the
outstanding bonds and preferred stock.
There is $1,562,900 of preferred stock
outstanding, and stockholders have been
urged to inform the Milwaukee Office of
the company on or before January 20
the price at which they are willing to
dispose OF their securities, which arc
redeemable at 115.
Representatives of the pre ferred
stockholders point out that of the So.
ooo,OO0 bonds that were issued in 1906
only $l,2S5,O00 were outstanding on De-
ccmber l, 1918, and declare their be-
llef that assets of the company seem
we'll able to take care of the bonds
and preferred stock In addition. there
is S1o,00o,000 of common stock out
standing which, they say, is very
closely held.
wv hlle the company reserves the
right" d statement which has been sent
out by representatives of the preferred
stockholders says, "to accept or reject
any tenders made. we understand that
interests conversant with the affairs of
the company hold the opinion that the
intrinsic value of the stock should war
rant tenders at not below par" The
jast bid on the stock in the open mar
ket was 90.
"lhc matter of the most advanta-
geous winding up Of our affairs will ap-
parently become of vital interest to
you who are holders of preferred stock
OF o. our company" says the letter of the
tabst Brewing Company to its share
holders, "in view Of the so-called war
time prohibltion act. which became a
law On November q, 1918. Under the
1000 stimulation proclamation the
Dre"1nS OF beer was required to be dis
continued on December 1, 1918. and un-
less a proclamation by the President
OF the United States is issued deter
mining date of emobilization of the
military forces of the United States
carrier than June 80, 1919. the sale of
L,
VIII be prohibited after July /, 1919.
anticipating the taking effect of
such prohibition, and that our plant,
equipped principally for the brewing Of
beer, would then become unproductive,
we are seeking to formulate some plans
working toward the redemption and re-
tlrement, first, of the bonds and, sec
ond, of the preferred stock of this
company.
amount Of $3,500,000, secured by trust
deed on our real estate, were issued by
the company, and such real estate Sc
curlty, or the proceeds derived from
the sale thereof, must be held intact
Tor the benefit of such bondholders.
These bonds, under the provision of
the trust deed, are now being retired at
the rate of $l50,000 year After keep
ing on hand at all times moneys ade-
quatc to meet the current obligations
OF the company to it's general unsc-
range for the creation of fund to be
derived from the sale before July of
our present stock of beer and the col
lection of our outstanding accounts
with which to redeem the z per cent
preferred stock of those holders
thereof who are desirous of selling
rather than specializing on the future
OF the brewing industry.
"As to whether this method of re-
tirement Of these outstanding obliga-
tions of our company will prove sue
cessfu is dependent upon the prompt
and voluntary action of the preferred
stockholders whose offers are accept
able to it, and preference will, there
fore, necessarily be given to the lowest
quotations."
The letter was sent out under the
signature Of H. j. Stark, secretary and
treasurer