Evening star., 1936-08-26
GAS CONTROL SALE.
PROPOSEDBYF|RM
CHECKED CLOSELY.
Reason for Move to Sell
Stock Remains mystery"
in Local Circles.
CAPITAL OWNERSHIP
SEEN AS POSSIBILITY
100000 Shares Held by Foreign"
Company May Be Disposed of
at Loss of Millions.

The Securities and Exchange Com
mission and the District Public Utili-
ties Commission today began scrutiny
of the proposal of the Washington Gas
Light Co. for the public sale of con-
trolling interest in the company, now
held by Washington & Suburban
Co.'S, a Massachusetts, common law
trust.
Ostensibly. registration with the
S. E. c. of 100000 shares of the COM
mon stock of the company repre-
sented a move by the foreign" con-
trolling interests to dispose of their
control, but mystery continued today
to surround the reasons for yester-
days sudden announcement.
The maneuver was represented as
an opportunity for Washington inter-
ests to regain control of this impor-
tant utility.
The price which Washington in
vestors or others will be asked to pay
for the majority stock probably will
not be known until about the middle
Of September.
Acting as agent for the controlling
trust, the Washington Gas Light Co.
yesterday afternoon filed with the
s. E. c. voluminous document pro-
posing the registration for sale of all
10000 of the common shares of stock
of the company, 109,196 of which are
held by Washington g. Suburban Co.'S
Before the proposal becomes effec-
tive. it must lie before the Federal
agency for 20 days. If amended, 20
additional days must pass from the
date of amendment before it is ef-
fective. Meantime, the Federal agency
could move to block the huge trans
action if it finds any reason for such
action. The District Public Utilities
Commission, while not yet in the pic
ture officially, is closely following
developments.
Local Unit Makes Announcement.
The Washington company filed a
copy of its proposal with the local
commission and asked the commits
sion to make public announcement Of
the move When asked why this was
done, a gas company spokesman said:
Because this commission for several
years has been vitality interested in
the question of the ownership and
control of the gas light company"
Persons close to the gas industry
say the price for the public sale Of
the stock will not be fixed until just
prior to the end of the 20-day exami-
nation period, September 13.
However. it is suggested the price
at the original sale likely will be
somewhere between SIT and the lower
COS.
The stock now held by Washington
g. Suburban Co.'S, under the pro-
posal would be sold to group
of investment bankers and dealers
who promptly will reoffer it to in
dfvidual investors in Washington and
throughout the country.
Reports here are to the effect that
the financial interests which bought
up the control interests some years
ago paid an average" price of SIPS
q share, with the top ranging into
about S135. If the stock were sold
to the public at somewhere between
SIT and $84, it is estimated the out
side interests would stand to lose
more than $5,000,000.
This accentuated the mystery as to
Just why the move is made for dis
position of the controlling stock in
terest, which carries with it the con-
templated dissolution of the Wash
angton g. Suburban Cos.
The District commission will step
officially into the picture if the
Washington gas company moves to
buy the Washington Suburban Co.
of Hyattsville. controlling the Hyatts-
vile plant, and the Alexandria Gas
Co. The commission is informed the
local utility is considering these pur-
chases. Such acquisitions cannot be
effected without approval of the COM
mission, as to price, among other
things.
The Massachusetts, common law
trust holds interest in these conf
panies and in the Richmond Gas Co,
of New York, as we'll as about "a per
cent of the stock of the Washington
Gas Light Co.
The commission also will scru-
tinize closely the transfer of stock
which would result from the pro-
posed public sale, to determine who
buys interests amounting to as much
as 20 per cent of the total issue. It
is prepared to act if it suspects any
one foreign group of interests acquires
Is much as that.
Under the La Toilette anti-merger
law any foreign corporation or COM
pany is forbidden to control, directly
Or indirectly, as much as 20 per cent
Of the stock of any Washington utility.
Halls Control Return to d. C.
Richmond B. Keech. acting chair
man of the District commission, said
the proposed sale and dissolution OF
the Massachusetts, trust would be
shighly advantageous" If it meant the
return to Washington investors Of
control of the local operating COM
pany, or if it meant the end Of con-
nol by foreign interests.
If the Washington gas company,
undertakes to buy the two suburban
concerns, it is expected there will be an
issuance of stock to cover the cost
Of acquisition of the properties. Such
In issue would have to pass muster
tefore the District commission.