New-York tribune., 1919-08-07
Atlantic Refining
To Sell $2O,000,0
OF Preferred Stock
Deprecated Dollar and
High Taxes Induces Second
of Former Standard Oil
Group 10 Recapitalize

Plans for the recapitalization of
the Atlantic Refining Company, before
the dissolution of the trust an i'm
portant unit in the Standard Oil
group, through the issuance and sale
% the stockholders of 500 100000 of
new : per cent cumulative preferred
stock and the authoriza ion of $45,-
100000 additional common stock, werc
announced Yesterday. The Standard
OIL Company Of New Jersey two
weeks ago departed from Standard
Oil precedent by announcing plans for
raising $l00,00OO00 in new capital
through the sale of stock. 1t is ev-
pected that others of the former
Standard Oil subsidiaries will follow
the example.
The step taken by the Atlantic Re-
capital stock from $5,00O,00O to $25,
100000 and the authorized and out
standing capital from $5,000,000 to
S7o,OoO,OOO. The S20,ooO,OOo of new
preferred will pay cumulative divi-
dends at the rate of per cent, but will
not carry the voting privilege. The
common stock is to remain in the
treasury of Che company to be IS
sued later, either in part or in whole.
Equitable Trust Underwriters
According to the official announce
ment of the financing programme, the
entire issue of preferred stock Will
be undcrwritten by the Equitable
Trust Company, of New York. The
subscription price will be par, $lO0,
payable either in full or in four
monthly instalments. 1t will be is
sued to the present holders of the
common stock on the basis of four
shares of the new issue at par for
each share of common now held.
The preferred stock is subject to
retirement in whole on any dividend
date after five years at S115 a share
Application will be made to list the
new issue on the New York Stock
Exchange, after it has been ratified by
the present stockholders at a meeting
called for October 6. In many re-
spects the new Atlantic Refining pre-
ferred will be similar to that issued
by the Standard Oil of New Jersey a
fortnight ago.
Reasons for Decision
In announcing the issue of new
stock j. w Van Dyke. president, gives
two reasons for the change in the
company's policy, as follows:
First-Because of the lessened
purchasing power OF the dollar as
compared with 1912, much more
capital must be available in the busi-
ness.
Second-Because the assessment Of
large Federal taxes at the present
time and for some time to
come, prevents the use of accruing
profits for purposes of business, as
heretofore In the past the policy Of
the Atlantic Refining, like all of the
other Standard Oil subsidiaries, has
been to finance its growth entirely
form current earnings.
summary of earnings and divi-
dends for the last four years. made
public in connection with the an
nouncement of recapitalization, shows
that in 1918 the company earned So
10000 before deducting Federal taxes.
After payment of Federal taxes
amounting to 100000 there re-
manned S7,41O,O0O net, out of which
Sl,000,000 in dividends was ,isbursed
to the stockholders, equivalent to 20
per cent. Net earnings of the COM
pany in 1917 after Federal taxes
amounted to S9,006,0 900, in 1916 20
$9,628,000. in 1915 to $5,592 900.
The balance sheet as of December
81 shows total assets of s77,24s,332, Of
which s4O539, ,743 are more or ! oss
liquid The surplus of the company
at the end of last year amounted to
S5O,952.S $50.