Evening star., 1954-12-22
Dixon Yates Seiup
Appears Headed for
Approval BY SEC
By Joseph a. For


The financial setup Of the $l07
million Dixon Yates power proj-
ect appeared headed today for
Securities and Exchange Conn
mission approval.
The commission wound up "a
days Of oral testimony yesterday
afternoon and moved toward the
final stages Of the hearing in
v0lving the controversial COM
tract between the Mississippi
Valley Generating Co, and the
Atomic Energy Commission. for
power to be served to the Ten
nessee Valley Authority system
to compensate for IVA power
the Acc Is using.
Opposing counsel were given
until January ii to file proposed
findings for the commissions
final REPORT. and an additional
week was allowed for responses.
Concluding argument was set
for January 10, and the COM
mission then win prepare its
decision.
Approval Seen.
The issue Is whether the n
nancing Of Mississippi Valley, q
subsidiary Of Middle South IT'LL
tiles and the Southern Co., COM
plies with the requirements of
the Holding Company Act.
Observers felt that the mar
row confines in which the OPP
position was required by the
commission to prosecute its case
pointed to the likelihood Of ulti-
mate approval for the power
combine.
If that happens, the opponents
win 60 to the Court of Appeals
here seeking review.
The Holding Company Act, in
general, proScrihes utility COM
pany tie-ups that tend toward
interlocking relationships or
concentration Of control that are
detrimental to the public in
terest Of the interest Of investors
or consumers. !"
The Dixon-Yates opponents,
spearheaded by the State Of Ten
nessee. were never able to develop
testimony bearing On this point.
Objections blocked their efforts
to trace the various steps lead
ing to the formation Of MVG.
Legality Not at Issue.
The Commission also held that
the legality Of the MVG-AEC
contract was not at issue, ruling
that "definitive action taken by
other agencies and branches Of
the Government" did not come
within the scope Of an SEC
hearing.
Whether the proposed power
protect steam plant at West
Memphis. Ark. which will fur
nish the current to the IVA
has q national defense aspect
was another question that went
unanswered. The Commission
said that the contract, bitterly
fought by public power advocates
speaks for itself sin this respect
The hearing before the SEC
Is concerned with the issuance
by Mississippi Valley Of SIS mill
lion Of common stock, to be sold
to Middle South and Southern
on a 1921 basis.
The company also proposes tc
borrow more than 500 million
from insurance companies and
banks in its financial program,
but approval for this debt capi-
talization will not be sought
until later.
The Securities Commission
earlier approved as national de-
tense projects two power COM
bines serving the Atomic Com
mission. but Dixon Yates oppo-
nents contended that these had
nothing in common with the
present venture.
Foes Arguments.
The principal argument Of
Joseph Volpe. jr., counsel for
Tennessee and about three dog
en- municipal and cooperative
power distributors, was that
the Dixon-Yates syndicate was
more interested In cutting into
the service area Of the Tennessee
Valley Authority than In devel-
oping anational defense project.
The hearing ended unexpect-
edly yesterday afternoon when
several organizations, including
the Tennessee Valley Public
Power Association, notified the
commission that they would file
briefs instead Of entering formal
appearance.
At the wind-up. Chairman
Ralph H. Demmler congratulated
counsel on behalf of the
commission for q "well-con-
Quoted" hearing. He said that
while we may have had our
of tenseness and In
tenseness. we very much appreci-
ate the cooperation from coun-
seI for all parties" J"
While the power group may get
The blessing Of the SEC, there
still are breakers ahead In Con-,
gress where Democrats are
threatening to kill the West
Memphis project.
In some power circles, how
ever. doubt is expressed that
this win happen.
r