Evening star., 1939-05-07

$40 900 600 lent them, GucttOneG
of stock held as collateral. George
A. Ball, fruit manufacturer, at
their beseechtng, paid $3,121 900
for the lot. Inquiry by a Senate
committee sho,Ded the actual cost
of 1000. 900 Alleghany shares Uas
s274,6S2. Mr.. Ball let the brothers
keep control. Then they died
insoloent, and he became rail-
master.
BY the Associated Press.
CLEVELAND, May 6.-Through q
strange sequence Of fortune and
fate, sprightly, 76-year-old George
A. Ball is again apparent master OF
one of Americas greatest railroad
networks-the 23,000-mile, So 900 ,000-
600 empire amassed by the Van
Sweringen brothers.
Mr.. Ball, who rescued the Van
Sweringens from financial quick
sand only to find himself directing
their railroads on their death, dis
posed Of the control two years ago.
He obtained, from a New York stock
broker and associates, $4,000, 900
cash and a $2.375 900 note.
Yesterday that note, backed by
1900 900 shares of Allegheny Corp.
stock, fell due. Today, undramatic-
ally. Mr.. Ball announced its default
and his re-entry into railroading.
Collateral Surrendered.
Thomas H. Jones, attorney for
charitable foundation set up by Mr..
Ball, telephoned Cleveland editors
this bare announcement:
"Messrs. Robert r. Young and
Allan P. Kirby and their associates
have surrendered to the Foundation
the 100000 shares of Allegheny
Corp. common stock held as collat-
eral for their $2375,0 note, thus
revesting to the Foundation owner
ship of such stock"
Mr.. Young is the 42-year- New
Yorker who joined Kirby and others
ir taking over, in 1887, the control
of Allegheny Corp, top holding COM
pany for the Chesapeake g. Ohio
and other railroads.
al UlSdll0 Vi Vt11 Oullk WClC 4ulIh
to deny that surrender of the stock
meant immediate control for Mr..
Balls foundation. They said Mr..
Ball could not muster sufficient stock
to call special stockholders meet
ing, with the result present directors
would remain at the throttle at least
until the next regular meeting in
May, 1910.
Young's Grip Loosened.
But Mr.. Youngs hold on the en-
pire has seemed to be crumbling for
several months. c. & O's board was
enlarged. over his protest, to include
Representatives of New York's Guar
anty Trust Co. and last month he
was dropped from two important di-
rectors' committees of this road,
highly profitable key Of the Van
Sweringen group.
Mr.. Young has pending, however
a $5,000,000 suit against Mr.. Ball.
This suit charges Ball illegally en-
gagged in certain stock exchange
transactions to create both actual
and APPARENT active trading in the
securities Of the Allegheny Corp"
Thus, Mr.. Young contends, he was
led to pay too much for the Ale
ghany common.
There are 4,500,O00 Allegheny
shares outstanding. Mr.. Young's
syndicate in 1887 obtained 1,933,810
counting the 200 900 put up against
the note. This total has been suffi-
cient to swing nominal control. The
belief has been widespread in Wal
Street that Mr.. Young recently dis
posed of Allegheny stock he held
outright. but he said this belief was
unwarranted.
Attorneys for the Young interests
this afternoon made public letter
sent to Mr.. Ball today by Allan p
Kirby, capitalist, of Convent, N. j..
and Wilkes-Barre, Pa, who was
allied with Mr.. Young in the Allie
ghany venture. The letter, which
the Young group attorneys said list
ed reasons" why the Ball note was
not being paid of. charged the
indicated market value of the Ale
ghany securities" at the time of pur-
chase, May S, 1887, was fictitious
and excessive" It further charged
the Ball interests had opposed us
on every possible occasion"