Evening star., 1938-09-29
COUCH EXPECTED
TO WIN MERGER
Unification of K. c. S. and
l. & A. Will Be Triumph
for Utility Magnate.
By the Associated Press

NEW YORK. Sept. 2s.-Harvey
Crowley Couch, Southwest utility mag
nate who began his business career as
a soda jerker, emerged yesterday as
the first rail executive since the de-
preston likely to accomplish a major
rail merger.
/ Couch. big burly and soft-spoken.
who of all his titles is proudest to be
called first citizen Of Pine Bluff, Ark,
has not yet quite accomplished the
wedding Of Kansas City Southern and
Louisiana & Arkansas
But yesterday the board of X. S. c..
which has 900-mile straight line con-
nection between Kansas City and the
Sabine ports of Texas, unanimously
approved the Couch plan. 1t still re-
quires approval of the Interstate Com
lnerce Commission, of stockholders of
K. C. S.. and of L. e. A.
No one doubted that L. d. A. would
approve, since Couch heads a syndi-
cate controlling that road. Couch said
large group of K. c. S. stockholders,
whose interests are represented by
directors have indicated approval No
one. of course. can predict what the
I. c. c. will do, but during the three
years the plan has been discussed there
has been no public expression of dis
approval from that quarter.
Worked as Mail Clerk.
COUGHS interest in rails. though pos
sibly new to the public at large, goes
back to his early 20s-he is now
over so. but doesn't look it-when he
left his job as a drugstore clerk to
become a railway mail clerk. Then
Couch became tremendously excited,
about that new invention-then a fea-
ture of every first class drugstore
the telephone.
He organized and became president
Of the North Louisiana Telephone Co.,
and just naturally from there became
an organizer and executive of the
electric utilities creeping into the
Southwest.
Seeking to reduce electric rates for
small consumers-for example. by de-
veloping a rural line that cut installa-
ton cost in half-Couch decided the
area served by his utilities needed more
industrial plants. But, in order to at
tract industrial plants. it was neces-
sary to provide more attractive rail-
road service.
So Couch, his relatives and his
friends, got control of and amalga-
mated the Louisiana Railroad Il Navi-
hn of
William Edenborn and the L. l. A.
Through the heirs of William Bu-
chanan.
Then he proceeded to make the TOO
mile railroad, the main line of which
runs from New Orleans to Dallas, Tex.
as near model one as he could.
Started Merger Study.
A few years ago he began carefully
studying the plan for merging the X.
c. S. and the L. & A., originated by
Leonor F. Loree more than Is years
ago, but given up after the successive
blows of the rival Van Sweringen-
Missouri Pacific plans and the depres-
sion.
Couch put engineers to work making |
independent studies. As chief stock
holder of L. l. A. and as chairman of |
Kansas City Southern, he was in a po-
sition to have operating and trafic de- |
partments Of both roads study the
proposal
When all agreed that the merger
would help earnings Of both roads he
began trying to sell the plan to bank
ers and directors of both roads.
Kuhn Loeb l. Co., Ladenburg. Thai |
mann & Co. and Dillon. Reed l. Co.,
New York bankers. got to work on it.
The plan they finally worked out |
called for no exchange of cash, no in
crease in debt or preferred stock. X. C.
8. would, by new issue of 10000
shares of common, acquire an equiv
alent value of L. l. A.. preferred and
common, thus controlling the road.
Couch said he hoped to make the
unified system "the finest railroad in
the country" and said his goal was to
make the first years unified net earn
ings for K. c. S. above 81 q share on
the common"