The sun., 1919-09-26
AMER. TEL. & TEL.
PLANS NOTE ISSUE
Arranges to Sell $50,000,000
in 6 P. G. 8 Year Securities
to Morgan Syndicate.
TO BE OFFERED PUBLICLY
Funds Obtained Will Be Kept
for Future Needs as Fore
cast Now.

The American Telephone and Tele-
graph Company has arranged to sell
soo'ooo'ooo per cent. three year notes
TO syndicate headed by ]. p. Morgan
& Co., 1t was announced yesterday. The
notes Will be issued shortly for public
subscription. but the price will not be
learned until some time to-day. The
new financing has been decided upon to
provide funds at this time for future
needs as forecast by the volume Of the
company's business. which is abnor-
mally large ...,
There have been rumors IN the Street
from time to time that the company
would have to do some financing in the
near future. but those reports, which
included a forecast that the company
would Issue preferred stock. met with
denial in more or less official quarters
right up to the time for the formal an
nouncement.
The syndicate which has In hand the
marketing of the $50,000.o00 notes Is
said to be composed of ]. p, Morgan &
Co, Kidder. Peabody & Co.. Kuhn, Loeb
tional City Company. Harris, Forbes &
Co. and Lee. Higginson & Co. Possibly
some out of town institutions are in
the syndicate.
The previous financing was consum-
mated in January of the current year
when the company sold to a syndicate,
headed by ]. p. Morgan & Co. 100000
coo Ave year per cent. notes at 9sk
end interest and $25,000,000 New York
Telephone thirty year debenture IS at
101 and interest. The former provided
no fresh capital, as the proceeds were
used to retire s40,000.000 Endorsed notes
OF subsidiary companies which matured
on February /, 1919. The latter issue
however, provided fresh capital.
All Of the proceeds Of the current Is
sue are to be used for new capital and
corporate construction, 1t Is reported,
taking care of the company's needs for
several months to come. The last
financing, which provided commensur-
ate amount of fresh working capital. was
in July, 1918. when the company offered
S44.500,000 seven year convertible per
cent. bonds. They were offered to stock
holders, who subscribed for about 80 per
cent. of that interest at "a. The re-
mainder was taken by the underwriting
syndicate. which successfully marketed 1t
at prices ranging from 941a to 90.
In connection with the new financing
the company issued a statement pointing
out that action already taken on rates
by State commissions assures that
rothing will be done which will ieopar-
die the earnings of the company, which
are now and have been sufficient for the
last thirteen years to provide for the
payment of all charges and a dividend
of s per cent on its capital stock, of
which there is more than S440, 900 900
outstanding The current market price
for that issue, paying per cent. a
year, is around %.
The company also says that the Gov
eminent hasreturned all teiephone and
telegraph systems of the Bell system in
the United States to their respective
owners in as good condition as when
put under Federal control, that the prop
critics have been maintained according
to the usual standards. that usual re-
serves for depreciation have been made
and that wages have been increased or
are being adjusted to a scale suitable
to cover increased costs.