The sun., 1919-06-25
UNITED DRUG WILL
OFFER NEW STOCK
New York and Boston Bankers
to Underwrite Issue Of ST..
100000 Preferred.
STOCKHOLDERS APPROVE
Funds Are for More Working
Capital and to Retire
49,. Floating Debt. =

A syndicate composed of Kidder, Pea
body Co. and the Chase Securities
Corporation OF this city and r. s. Nose
ley & Co OF Boston has been formed to
underwrite the s7,5OO,0o0 additional first
preferred stock to be issued out OF the
St2,5oo.o0O authorized by the stockhold-
ers at their special meeting In Boston
yesterday. The need for more working
capital to take care OF proposed ex-
pansion and for funds with which to
retire the floating debt OF the CONSOLE
dated companies Is the reason assigned
for the financing e.
The new stock is to DO offered to pres
ent stockholders for subscription up TO
July Is: 1919. Subscriptions by second
preferred and common stock holders VIII
be accepted subject to tho prior rights
of the first preferred holders, the last
named Of whom may subscribe at the
rate OF a share for a share OF the old
first preferred now held. Payments will
be made In three instalments, namely,
Sfo-a share with subscription on July
10, SIS share on September / and the
remaining SIS a share on November /.
The stock is of $50 q share par value
and may be redeemed on any dividend
date at $50 a share. Its dividends are
per cent cumulative and 1t is.preferred
as to assets and earnings. Any OF the
stock not subscribed for probably will
be offered to the public by the syndicate.
Louis K. Liggett, president of the
company. in a letter to the banking syn
dictate setting forth the position of the
company estimates the company's sales
for the present year as more than $62,-
100000. net profls as $4,000, 900 and
about 100000 available for dividend
after payment of an estimated $1,000. 900
for excess profits and. income taxes.
That amount, the letter declares. repre-
sents five times the dividend require
ments- on the first preferred, including
the new ISSUE ...
The United Drug Company was
formed in 1909 by forty retail druggists
for manufacturing under one trade mark
medicinal and toilet preparations. The
first years sales. according to the letter,
were $4,000. The business grew rapidly
until 1910, when sales exceeded $1,000
600. 'In 1915" the letter continues
the company had developed far beyond
Its original business and supplied
$500 stakeholder agents not only with
medicinal and toilet preparations but
With pharmaceuticals, perfumes, candles,
soda fountain supplies, stationery, rub
products and druggists sundries, all
under controlled brands"
All of the assets and business OF the
original business were taken over In
1915 by the newly formed United Drug
Company of Massachusetts,. Included
in that consolidation were the assets and
business OF the Riker & Hegeman Com
pany. which conducted producing labora-
tories and owned 1e6 retail stores.
-, q
stakeholder agents. the letter contin-
ues. lin the, United States. Great Brit
| ain and Canada. and the company owns
and operates 216 retail drug stores. I'M
der the name of Liggett's Stores, in New
York. Boston, Philadelphia, Washington.
Atlanta, Baltimore, New Orleans, Fort
Worth and other cities in the East and
in milwaukee,. Minneapolis. Detroit and
other cities in the middle West and in
| Ottawa, Toronto Hamilton; Winnipeg
and Calgary. CanhGa.
| 1.-THE combir "a sales OF the corpora
ton, including sales by the United Drug
| Company to Llggetts Stores for 1916
were s33,224.s66; 1917, $40,716,2S9
1918, s51,02s,335. The earnings, after
liberal depreciation, were 1916, S2.014,-
500; 1917. $2S16.65s; 1918, $3.O4S.114
In each year net profits available for
distribution were over five times
1 the dividend requirements on the out
standing first preferred stock. From
1904 the company has continuously paid
dividends.
"Since the consolidation dividends
have been paid on the first and second
preferred stocks, and the common paid
at the rate of per cent. during 1911
and 1918. One per cent. extra was
paid on January 8, 1919. and at pres
ent the rate is Z per cent The CON-
pany did no public financing until Sep
TENDER. 1916, when s2.500,0O0 first pre-
ferred stock was sold. The stockholders
took approximately 80 per cent of this
at par.
'.The growth OF the business is &C
rapid and the opportunities for develop.
ment so obvious that 1t Is deemed de-
sirable to increase the authorized first
preferred stock from s7.50O,O00 to $40.
100000 and to issue $7,500.000 of TIL:
increase now. and with the proceedG re
tire all OF the floating Indebtedness OF
the consolidated companies of approx.
mately> $4,000, 900, retire preferred stocks
OF subsidiaries 100000 and increase
manufacturing facilities and working
capital"