Air Split

When, last week, directors of Air Reduction Co. recommended a 3-for-1 split-up of its 835,000 shares, many a trader did the following problem in simple arithmetic :

In 1920, when Air Reduction stock moved over from the Curb to the Big Board, 100 shares could have been purchased for $3,200. In 1928 the stock was split 3-for-1. Last week the new stock was up to $172. Thus the original holding of 100 shares at $32 had grown to 300 shares at $172, and a $3,200 investment had reached a market value of $51,600. The new stock split will not be ratified by stockholders until next April, at which date the original 100-share-holder will have 900 shares, will be disappointed if those shares are not worth at least $60 apiece.

During the first nine months of 1935 Air Reduction Co. made $3,895,000. Full year earnings may come to $5,000,000, compared to a top of about $6,000,000 in 1929. The regular $3 dividend has been augmented by two extras, bringing dividend payments thus far this year up to $5.50. Technically a "chemical company," Air Reduction should not be confused with Allied Chemical, E. I. du Pont de Nemours, or any other corporation with a general line of chemical products. The company specializes in two major products --acetylene and oxygen. A combination of acetylene and oxygen, ignited, burns at a temperature of 6,400DEG F.--the hottest flame that man has yet produced. The oxygen-acetylene flame, directed with an oxyacetylene torch, melts practically every kind of metal almost instantaneously. It has two kinds of uses: cutting metal, as in scrapping locomotives, battleships; welding metal, in which the oxyacetylene flame fuses the parts to be joined together. Air Reduction is so called because it reduces air--that is, it separates air into its major components, primarily oxygen and nitrogen.

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