New-York tribune., 1922-08-25
Tel. & Tel. Will
Offer Stock to
Shareholders
Subscribers May Take One
Sha-e for Each Five Held
ON September 8; $Il5.-
MO, 900 To BE Issued
Funds for Extensions
Payments May BE Spread
Over 3 Months; First
Due November 1, 1922

american Telephone and Telegraph
directors yesterday voted to offer dr.
rect to stockholders of record Septem-
ber 3 one share of new stock at par
for each five shares then held. The
amount offered will be approximately
$I15 .8G0, coo.
The action of the board came as
something of a surprise in the fnan-
ciai district, as it had been thought
that any new stock financing byathe
company would not be announced until
some time next fall. On the Stock
Exchange there was a selling move
nent in "Tel & Tel'' shares which car
ried the price from a high of 1925 to
low of 11s, with the final sale at
1895, loss of 2A points compared
with Wednesdays last transactions.
H. F.. Thayer, president, in making
the announcement of the new offering,
said that the funds raised will provide
for extensions to the compary's tele-
phone system for considerable
period to come.
Demand Increasing
During the last two years of ad-
verse business conditions he said,
'the demand for telephone service has
shown no abatement. During that
period there have been million tele-
phones added to the Bell System and
there are now on file untitled applica-
tions for about 100000 telephones.
This contsnuing expansion of the
telephone / isiness requires additional
plant, and I'm view of the prospect of
better general business an even
greater than normal growth is ex-
pected.
"By a substantial issue of stock at
this time the growth of the business
for considerable period to come will
be provided for without further stock
offering to stockholders. The company
is in funds to meet the balance now
outstanding of its s50,o00,00o note
issue due October ], 1922, and the
funds from the stock issue will pro-
vide for extensions of the national
telephone system"
Directors at their meeting indicated
that the present 9 per cent dividend
rate would be continued on the in
creased amount of stock by declaring
quarterly dividends of S2.25 share,
payable quarterly up to June 80, 1928.
At present the American Telephone
and Telegraph Company has outstand-
ing about $571 100000 of stock. The
new issue will bring the total up to
about s686,000,000. Stockholders num-
Der more than 100000. Calculated at
yesterdays closing quotation the
rights to subscribe to the new stock
were worth about So share.
Payments in Installments
Payments for the new stock will be
spread over a period Of eight months,
the first installment of $50 being the
on November 1, 1922; the second of
$40 on March /, 1923, and the third of
$40 on July /, 1923. Interest at the
rate OF per cent, amounting to $1.60
a share, will be allowed on the INSTALL
ment payments from their due dates
to July ! and will be credited on this
The stock so paid for will be issued
under date of July 1, 1923.
Subscribers, however, will be per-
mitted to pay subscriptions in full on
November 1, 1922, or, having made the
first payment when due, they may pay
the two remaining installmenta on
March /, 1928. In such instances the
excess amount which the company will
pay in dividends at the current rate
of per cent up to July /, 1926, over
interest on the money paid up to that
date mast be paid in addition. If,
therefore. subscriptions are paid in
a share will be par ts1oo) plus $2.75
q total of Sf02.75 per share, and if
final installments Of $50 share are
made on March /, 1923, the amounts
payable then will be paid 32.10 per
share additional, total of $8210 a
share. Stock so paid for will be issued
as of its date of final payment
The American Telephone and Tele-
graph balance sheet as of June 80 last
shows bonds and notes of and net ad-
vances to associated companies
amounting to Sii5,664,693; cash end
deposits, $25,592,667; United States
obligations, S55,16T ,169; bills receiv-
able, S18967 900; accounts receivable,
s5,288,6l6, and other working assets
of S3,566, ISL.
On the liabilities side are listed ac-
counts payable, $1.694,272; interest
and taxes accrued, S7,459,7S9, and sur
plus and reserves of $1so,966, III.