Again, Gold Dust

Inoperative for three months was the United Stores Corp., formed as a holding company last June to assume control of United Cigars Co., Tobacco Products Corp. (TIME, June 17). Although George K. Morrow and Frederick K. Morrow, heads of the Gold Dust Corp., were then announced as dominant figures in the new holding concern, George J. Whelan, oldtime United Cigar Store tycoon, continued to manage the affairs of the two tobacco companies.

Still inoperative last week, United Stores Corp. seemed almost certain of passing out of existence as a new consolidation of United Cigars Co., Tobacco Products Corp., Gold Dust Corp. interests appeared. This time the Morrows and others acquired majority stock holdings of the tobacco companies, whose assets amount to some $200,000,000. At a directors' meeting George K. Morrow was elected President and Board Chairman of both companies, Mr. Whelan was retained on the directorates.

Business men hastened to speculate on reasons for the new combination. Most obvious seemed the desire to bring new financial power into United Cigar Co. and Tobacco Products Corp., whose earnings were depressed as a result of price lowering of popular brand cigarets to compete with price-cutting chain stores. From a high this year of 27 3/8, United Cigar stock had dropped last week to 15 5/8. Likewise Tobacco Products Corp. experienced a drop, from the year's high of 22 5/8 to a closing last week of 12 3/4.

Recurring also was the reason advanced that the consolidation would greatly enhance the facilities of Gold Dust Corp., which has been engaged in distributing trademarked food products, soap, washing and scouring powders, shoe polishes, other articles. Natural was the assumption that United Cigar Stores, Whelan Drug Stores, the other Tobacco Products Corp. outlets, which altogether number some 92,000 stores reaching from coast to coast, would (become potent retail points for Gold Dust products.