The Omaha morning bee., 1924-07-17
Farm Grain.
Firm toSave
Big Economy Possible Under
Merger of Five Marketing
Concerns, Backers
Declare.
Farmer Control Assured

Chicago, July 16.-The exact mea-
hod by which American farmers event
ua1ly are expected to gain control OF
the S26.000.000 stock OF the Grain
Marketing company, a merger of five
of the country's largest grain market
ing concerns formed with a view to
giving the producers ownership and
control OF selling and distribution,
cannot he stated at this time.'' Mil
lard r. Myers, representing several
Illinois co-operatives, said tonight in
commenting on the project.
1t is enought." he said, TO know
that the property is to be taken over
on square deal basis and that the
stock offered to the public shall be
worth the money at which it is pro
posed to be sold
The Illinois cooperative law, under
whose provisions the company was
organized, restricts issuance of com
mon stock to individuals or associ-
alton engaged in producing the com
modify TO be handled. Another pro-
vision, however, permits the issuance
OF preferred stock which is not so
restricted, with or without the right
TO vote
s2,500,000 Saving Possible.
The articles OF Incorporation pro-
vide for $4,000 900 of preferred stock
and s1,000,O00 of common stock.
Financial men involved in the deal
maintain that a saving of $500, 900
to s3,000,000 annually is possible by
uniting the grain concerns. Accord
ing 10 ii. s. Ballard, counsel for the
Ohio Farm Bureau federation, who
has been acting as counsel for the
grain merger committee of the Ameri-
can Farm Bureau federation, which
has endorsed the plan with reserva-
tons. the cooperative laws contain
strict clauses to insure producer
control of the corporation. Grain pro-
pucers say that the laws probably
will be construed literally during the
period Of transition.
According to Mr.. Ballard. the pro-
visions of the national Capper-Vol.
stead act that each member shall
but one vote. regardless OF the
amount OF stock he owns, must govern
the new corporation because it will
engage in interstatecommeree.
Not Stock Sell Scheme.
In explaining plans for the tran
sition period. Mr.. Meyers said the
Initial working capital must come
from the five grain companies whose
companies are TO be merged. these
companies hold preferred stock.
"A certain type of preferred stock
can be exchanged for property" Mr..
Meyers said, and producers will be
given time to absorb il. This will
give the five companies control until
producers have bought half the stock.
There Is a trusteeship OF Is to 100
farmers, and the farmers will have
two-thirds majority on the board OF
directors.
We at the producers end prob
ably will take two months 10 make
our appraisal OF the properties. We
Will make no immediate effort ~ in
duce farmers to buy stock. This Is
not stock selling promotion pro
position. but the bringing together
OF grain marketing agencies which
have abundance OF capital and facill-
ties for handling all the frain that IL
offered. and OF working with the
farmers elevators and other grain
marketing agencies In solving the
problem Of orderly marketing. In this
why they can bring to every grower
the worlds best market price for his
grain"
THE corporation contemplated un.
der the act which the new concern
takes advantage Of" Mr. Ballard said,
does not control price. but effects
savings for the producer.