Receiverships

MOP. In 1929 Missouri Pacific R. R. stock was eyed curiously because of a long, unspectacular but steady rise in price. Not until long after the stock-market crash did the public learn the reason why: Cleveland's Van Sweringen Brothers had been quietly buying control. The Brothers Van Sweringen put $86,000,000 into MOP securities, paid better than $80 a share for the common stock majority. Last week MOP stock sold at $1.25. Borne down with a weary load of debt and dwindling earnings, MOP subsided into bankruptcy.

It was the first railroad to seek salvation through the new bankruptcy law rather than receivership. Enacted to permit roads to scale down top-heavy debt structure quickly, cheaply, thoroughly, the law is expected to fit neatly into President

Roosevelt's railroad schemes wherever-whenever the Coordinator sees a reorganization needed (see p. 53). MOP's bankruptcy was precipitated by a $35,000,000 bond issue maturing May 1. From the R. F. C. it had already borrowed $23,000,000 in the last year and lately it had been requesting R. F. C. funds to pay interest on earlier R. F. C. loans.

Its 11,000 mi. of line, upwards of $600,000,000 in assets, gives MOP a place among the first ten U. S. roads. The Brothers Van Sweringen bought it to complete what the late great Edward Henry Harriman and Leonor Fresnel Loree long coveted--a transcontinental railroad system. Today though no other Van Sweringen line has actually collapsed, their superstructure of holding companies is supported almost solely by Chesapeake & Ohio--only U. S. road still paying dividends at the 1929 rate.

Brentano's, Inc., largest retail book chain in the U. S., passed into receivership. Gross sales last year were reported "about $1,500,000" as compared to $3,000,000 in "a good year." Cause for the receivership was the petition of seven publishers to whom Brentano's owed sums up to $19,000 each. For some time the firm has been operating on a standstill agreement providing the freezing of some $375,000 owed to publishers. Last week two or three publishers grew restless. Receivership followed. Other publishers pointed out that if Brentano's were forced to liquidate half a million dollars worth of books would be thrown on the market at bargain prices. Brentano's, which increased the number of its stores from three to ten before the Depression, had been caught overextended.

Louis K. Liggett Co. Drug Inc.'s Liggett chain with 450 stores has long been in difficulties by reason of falling sales. Chief expense needing reduction to make ends meet was rent. Arduous efforts were made to get Liggett's landlords to join in granting rent relief of $1,400,000 in order to carry on. In recent weeks this result was practically achieved but sales fell faster than rents. Last week the company gave up, went into bankruptcy.

Bush Terminal. Receivership for Bush Terminal Co. last week put an end to the confused controversy between Founder Irving Ter Bush and the management that succeeded his (TIME, March 27). Two outsiders, James C. Van Siclen, official referee for the New York State Supreme Court, and C. Walter Randall were appointed temporary receivers.

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