Evening star. [volume] (Washington, D.C.) 1854-1972, 1937-03-12
Gas Light
Continued From First Page.)

company to sell its holdings to the
public and end its foreign" domina-
ton Of the local operating plant.
That plan has been pending before the
Securities and Exchange Commission
since last Summer.
The trust now owns 100000 of the
existing 10000 shares of common
stock in the Washington Co., or about
81 per cent.
The proposal of the Washington Co.
to tie the purchase of the suburban
companies from the trust into the
proposed financial reorganization
brings up an old issue.
When the trust last August filed
with the Federal agency its proposal
to sell its 10000 shares local spokes-
men declared that as a condition pre-
| cedent to that move it expected the
Washington Co. to buy from the par
ent trust the two suburban concerns.
The District commission, while hav-
ing no control over the proposed sale
by the trust Of its shares, let company
officials know they would consider
purchase of the two burban con-
Germs on the merits Of that case, with
out involving the other.
100000 Issue Proposed.
Last August the Washington Co.
| proposed to sell 100000 Of pre-
ferred stock to raise funds first to be
able to pay cash to the parent for the
suburban concerns, and second to pro-
vide funds for company expansions.
AT hearing on the proposed pur-
chase OF the suburban companies. off,
Gals OF the Washington Co. were
asked by the commission if the trust
would accept preferred stock, instead
OF cash. A company spokesman said
1t would not
Testimony showed that the Alex
andria company had never paid divi-
dend and that it had not been able to
pay interest on the greater part of an
100000 debt. The Hyattsville Co.
paid a quarterly dividend of so cents
per share in 1888 and 1885 and in
1896 dividend of rs cents per share.
Marcy L. Sperry, president of the
Washington company, told the COM
mission the company had four objec-
tives in the proposed program: ITO
effect wider distribution Of the COM
pany's stock, with possible local con-
troll; a Encouragement of its capital
structure, refunding of certain obli-
cations to effect substantial savings in
interest charges, and better cash and
operating position
Bonds so Per Cent.
The company now has a heavy load
OF bonds as opposed to stock This was
principal argument for enactment
OF the law permitting the company to
expand its stock issue. Roughly, bonds
now constitute about 80 per cent Of
the capital structure and stock about
20 per cent. Sperry said if the pro-
posed plan is approved the ratio would
be roughly so and 40 per cent.
Owners of a large portion of the
outstanding common stock paid as
high as $l20 per share for it. Par
value is $40. In recent times the
bid has been running about s84 and
the asked price about $685. A dividend
OF about $l8 per share per year has
been paid, but this is measured
against the $40 par value.
Experts have explained in recent
months that interests represented by
the trust stood to take q loss of
somewhere near 100000 in its de-
clared move to dispose of its control
in the Washington company. The
trust was created some years ago,
after investigation by the commission
of the several foreign" holding COM
panies which had controlled the WASH
ngton company. That investigation
eliminated with an order from the
United States District Court that
foreign holding companies must dis
pose of their interests.