Evening star., 1935-11-16
GAS FIRM OWNERS
WILL AUCTION 1890
SHARES IN TRUST
District Court and Utilities
Body Are Informed of
Sale Wednesday.
MOVE SEEN TO EVADE
HOLDING RESTRICTIONS
Action Follows Announcement of
Assets Readjustment by Ameri.
can Founders.

Public Utilities Commission were no
titled today by counsel for the owner
ship interests of the Washington Gas
Light Co. that 1900 shares in the
ownership trust would be sold at auc-
ton in New York City Wednesday.
The notice would indicate some 80
per cent of the total number of shares
of beneficial interest" in the trust
would be sold.
The General Investment Co., for
merly known as the Public Utility
Holding Corp. and the United Found
ers Corp, the notice said, leach pro-
poses to sell at public auction on No
vember 20, 900 Of the shares of bene-
fetal interest in the Washington g.
Suburban Cos. (the ownership trust)."
Follows Announcement.
Receipt of this notice followed an
announcement in New York that the
American Founders Corp. proposes
to readjust its assets. The New York
report also said other corporations in
New York were making similar moves.
Informed observers here were under
the impression this was q move by
New York corporations to effect reor-
ganization so they could no longer be
construed as being holding COM
panies," which would be affected by
the terms of the 1885 holding COM
pany act. There was no Official no
tice regarding this available here.
The Washington Gas Light Co.
owns the Georgetown Gas Light Co.
and controls other local subsidiaries.
The Washington Gas Light Co. is
controlled by Washington &, Suburban
Co.'S, a Massachusetts, common law
trust, which represents Chase National
Bank and certain other financial
interests.
Creation Of the Massachusetts, COM
mon law trust resulted from q move
by the District Utilities Commission
to force outside holding company in
terests to divest themselves of control
of the local gas company.
None Owns 20 Per Cent.
There are 5000 shares of beneficial
interest in Washington g. Suburban
Co.'S, owned by various concerns in
blocks ranging from 100 to 1900
shares, SO no one entity controls 20
per cent or more, which would be In
violation Of the La Toilette anti
merger law. The La Toilette act, how
ever, does not list common law trusts"
in its prohibition on trusts and holding
companies.
In q consent decree in December,
1882. in which the creation of the
common law trust was recognized, Dis
trict Supreme Court ordered that the
case be kept open" and required
that the ownership interests notify
the court and the District Utilities
Commission of any change in owner
ship of the shares.
At the time Of the courts decision
it was shown that the United
Founders Corp. held 4s0 of the shares
of beneficial interest. AS the notice
received today here indicated this cor
poration would sell at the auction 9OC
shares, observers here believed that
the apparent showing of the holding OF
420 additional shares by this corpora
ton would be explained by other de-
velopnents reported in New York.
Notice From Attorneys.
The notice to the District Supreme
Court and the Utilities Commission
came from Sullivan & Cromwell, at
torneys for the Washington and Sub
urban companies and other holding
groups. The letter to the court said
"As counsel for Washington &
Suburban Co.'S, we have been advised
by General Investment Corp. (for-
merly the Publicity Utility Holding
Corp. Of America and United Founders
Corp) that they each propose to sell
at public auction on November 20,
1895, 900 Of the comon shares Of bene-
fetal interest in Washington & Sub
urban Cos, a Massachusetts, common
law trust.
AS soon as such shares are pre-
sented for transfer, after the auction
has taken place, We shall advise YOU
as to the name into which such shares
are transferred. This information is
sent to you pursuant to the consent
decree entered in the above matters
by the Hon. Peyton Gordon, Justice OF
the Supreme Court of the District of
Columbia, on the 23d day of Decem-
ber, 1892"