Evening star., 1941-03-21
Dissolution Of United
Light & Power Co.
Ordered byS.
Frank Calls Action
Big Step in Big JOB
OF lnteqrution
Py the Associated Press.

In what Chairman Jerome Frank
described as "a big step in a big
job" of utility integration,, the Sc
curities Commission issued late yes
terday its first major dissolution
order, calling for the elimination OF
the United States Light & Power
Co., top unit in $500, 900 900 holding
| company system.
The action against United Light
had been anticipated by the COM
pany,. which outlined last week a
probable method of compliance with
the integration section of the Hold
ing Company Act.
The S. E. C.'s order also called for
dissolution of United American Co.,
an intermediary holding company,
and indirectly will bring the elimi-
nation of about a dozen companies
now in the system.
Mr.. Frank discussed the intergra-
ton problem as a whole at press
conference a few hours after the
Senate confirmed his nomination to
be judge of the Second Judicial
Circuit Court.
Other Orders Planned.
Beaming with satisfaction over
progress of the integration program,
Mr.. Frank said that I'VE think we've
crossed the great divide-very def
nitely' and that what was once
idle speculation has now become
reality"
I'VE have definitely broken the
back of the integration problem, ~
he said. The bottleneck is begin
ming to vanish. We are going to
get rid of the scissors and paste
structure in holding company sys-
tems-that type of structure is on
its way out"
He said that other orders for dis
solution of companies considered
unnecessary or for disposal Of nom
integrated properties could be ex-
pected soon.
Mr.. Frank said the present hold
ing company Setup was impeding
expansion necessary to defense" and
that integration would permit op-
Grating companies to do their 'inde-
pendent financing adequately"
He called attention to a recent
study by a large statistical house,
which said the prospective values
OF many securities of companies in
holding systems to be greater than
the present market value.
Mr.. Frank said that under the
estimates of that conservative house
the securities holders of the holding
companies would be, generally
speaking, considerably better off un-
der integration.
Operates in IA States.
The United Light & Power Co.
system as now constituted operates
in IA States. Yesterdays order,
which was step toward corporate
Simplification in conformity with
the grandfather clause
prohibits more than two holding
companies above an operating unit
will not directly affect the op-
Grating scope Of the system.
Its first accomplishment will be to
make the United Light & Railways
Co. the top unit in the system. This
company then will control directly
two intermediary holding com
panieS-American Light g. Traction
Co. and Continental Gas & Electric
Corp; one operating company,
which is to be newly formed under
the plan and will be known as Peo-
Piles Light & Power Co.; one service
company, the United Light g. Power
Service Co.. and two transportation
companies, Tri-City Railway Co. I'll
linois) and Tri-City Railway Co.
Gowa).
Mr.. Frank said that additional
integration steps would be nee
essary after this major initial move.