Evening star. [volume] (Washington, D.C.) 1854-1972, 1929-12-29
REVIVAL IN MERGER
ACTIVITIES SEEN
New Year Expected to Wit.
ness More Arguments of
Corporations.
Special Dispatch to The Star

NEW YORK, December 28.-Develop-
ments in the last few weeks point
strongly to another active period of
1880.
? These will be most prominent among
public utility companies, iron and steel
manufacturers, investment trusts and
trading corporations, aviation and
amusement companies, interior banks,
and, depending on the attitude of Con-
gresS, with the railroads.
The recent amalgamation of a group
OF iron and steel properties in the Mid
die West by the Eaton interests, the
proposed merger of the Standard Steel
Car and Osgood Bradley Car Co. with
the Pullman Co., announced today, and
the new relationships Just established
by Standard Gas & Electric and Sug-
gested for the Associated Gas and Elec-
trio properties are evidences of the
momentum this movement has already
gained.
Motives Different.
There is a difference, however, be-
tween the motive for consultations to-
day and those that were almost daily
features In financial news in the earlier
part of the year. The latter were fire.
quently found to be profitable for the
promoters, in that they provided new
securities of the sort that the public
was then anxious to buy. Criticism
has been made particularly of bank
mergers that appeared to have little
justification except to offer opportunity
for broader speculation in the stocks
of the institutions concerned. The same
has been true of the unif1cation of pub
lie utility holding companies which were
projected and carried out on a grand
scale and later played part in the
imitation of public utility securities. 1t
Is of interest to read a section of the
recent Interstate Commerce Commits
sion plan for railroad consolidation, in
which one of the commissioners frankly
expressed the view that the only per-
sons concerned in this were the flnan-
cial interests who ARE likely to reap
large profits from the mere process OF
putting the roads together" Possibly
this member of the commission had in
mind the personal gains one of the
promoters of the Southwestern group
was alleged to have made out of this
transaction.
Merger Opportunities.
Future consultations, however will
grow out of the necessity for meeting
unfavorable business conditions with
the economies and greater efficiency
that mergers Of competitive concerns
provide.
Present conditions in the aviation in
duStry and In the amusement field fur
n1Sh many opportunities for bringing
together under one control properties
that have spread out too rapidly and
have exhausted themselves by too rapid
growth and at the same time have
had too little nourishment in the way
OF net earnings. They are now going
through the same trials that in previous
years led to the wedding out of the
weak members in the automobile in
duStry and the formation of a few
strong trade units.
The same conditions apply to the
trading of finance companies which had
a mushroom growth prior to the stock
market panic. This has left numerous
small companies in a weakened posi-
ton where they are willing to turn over
their assets to older and stronger or
CARNATIONS in the same field. It is
expected there will be a very pro-
nounced reduction in the number of
these corporations before the end of
1880.
Economic conditions are also believed
to be operating toward the merger of
oil-producing and refining companies
of crude oil and intense competition
with foreign companies require greater
coordination among the leading units
in the American field.
Stock Control Shifts.
Some Of the consultations now be-
ing considered are the direct effect of
the transfer of control of stock holdings
that took place when the market was in
its panicky state in October and No
vember. Interests at that time that
were carrying more of their own stock
than they could protect awoke later
to find that other interests with album
dant resources had relieved them of
SUFFICIENT amount of stock to jeopardize
their majority interest. So they have
found it convenient to accept terms for
consolidation which they had not the
remotest idea of considering a few
months ago. Instances of this have
been reported in the public utility in
dustry. in the amusement field and
with some of the smaller manufacturing
companies and in the affairs Of finance
corporations.