The New York herald., 1922-05-31
TOBACCO PRODUCTS
AND UNITED TO JOIN
James B. Duke, Back in Busi-
ness, Will Pilot $157,000,-
900 Organization.
HOLDERS VOTE JUNE %
James NJ. Dixon to Head New
Concern-Exchange of
Stock Planned.

A s157.000.000 tobacco merger was
announced yesterday by James NJ.
Dixon, president OF the Tobacco Prod
ucts Corporation. It is TO be formed of
the Tobacco Products and the United Re-
tail Stores corporations, the latter OF
which controls by stock ownership the
United Cigar Stores Company. The new
merger it Is understood is to be under the
guidance OF James b. Duke. who was
founder of the American Tobacco Com
pany and the British-American Tobacco
Corporation. and who thus will return
TO active participation in the tobacco
business.
Mr. Dixon, who is head of the new
concern, was associated with Mr.. Duke
from boyhood until he joined the present
Tobacco Products Corporation. Thomas
B. Yuille, who will join the new board
as the advisory head Of the leaf tobacco
buying department. also was trained
under Mr.. Duke, entering the service
OF Mr.. Dukes corporation as a boy and
working up to the position of vice-presi-
dent.
1t is planned to effect the merger by
an increase of capitalization of the
Tobacco Products Corporation and by
pany and of the United Retail Stores for
new Tobacco Products stock.
To Increase Capital Stock.
Under the terms Of the proposed mer-
ger the Tobacco Products Corporation is
TO increase its capital stock from
s3S.000,000 par value to s157.354, 900 par
value. The new stock is to be composed
of two classes. A and common. Glass A
Is to be per cent. non-cumulative,
on which dividends are to be paid soon
after completion of the merger. The
common. officers of the Tobacco
Products Corporation believe, will re-
ceive dividend Of not less than per
cent. for the coming fiscal year Begin
ming July /.
The increase in the capitalization of
Tobacco Products is just sufficient to
take care of the exchange of stock of
the two companies, no matter which
option holders elect to exercise The
merger therefore is without stock in
crease.
The proposal to the stockholders of
each company is an exchange of their
holdings Of common stock in each COR
poration for one-half share of class A
of the new per cent. Tobacco Products
stock and one-half share Of the new COM
JuOH lOT tdCn one SildIc VI Tue pTGoSiAl
holdings of the common stock.
The option, however, is extended to
the stockholders of both companies OF
taking all common stock of the new
merger in exchange for the common
stock of the present corporations. To-
bacco Products shareholders may take
all Class A il they desire.
Not Compelled to Exchange.
A shareholder is not compelled to
make the exchange, as he may ignore
ings. Holders of Retail Stores who
exchange will obtain certain return of
3Ia per cent. and a bonus in common
stock that is expected to yield an addi-
tional 21a per cent, thus giving an
equivalent of per cent. on their pres
ent holdings
Holders of huge block of United
Retail Stores stock have signified their
intention of taking all common stock
in exchange.
Owners of a large number OF shares
OF the Tobacco Products Corporation
have approved the proposal for the
change. An official notice has been
mailed to all stockholders Of meeting
on June % to vote on the proposal. Ac-
companying the notice James NJ. Dixon,
pr esident OF the Tobacco Products Cor
poration, sent each stockholder a letter
detailing the plan for combination.
"The merger" Mr. Dixon sald will
enable the United Cigar Stores. the prin-
cipal subsidiary Of Retail Stores, to ef-