Babe Out

"We're just babes in the woods," remarked Robert Ralph Young seven months ago when he and two other inconspicuous capitalists suddenly loomed as financial giants by buying control of Alleghany Corp., holding company for the $3,000,000,000 Van Sweringen rail and real-estate empire (TIME, May 3 et seq.). Since then a bitter autumn has swept bleakly through the financial forest. Last week it became known that the Babes in the Woods had also felt the chill wind. With no cocktails and canapes for the press such as accompanied the original Alleghany sale, it was revealed in a routine report to the Securities & Exchange Commission that Frank Frederick Kolbe, one of the original Babes, had sold out.

The report showed that Frank Kolbe had liquidated his holdings in the syndicate on Sept. 13 by selling several batches of securities, including 253,813 shares of Alleghany common which cost him $507,626 last April. To finance this hefty purchase he had borrowed $300,000 when Alleghany was selling at $4.50 a share and there were high hopes that the system's ponderous corporate superstructure could be simplified. Since May, however, Alleghany common has fallen as low as $1 and simplification plans have bogged down in a morass of counterproposals, Senatorial investigations and court injunctions. Under such circumstances it was obvious why Frank Kolbe had sold out.

Last week the remaining two Babes in the Woods, Allan Price Kirby, son of one of the founders of F. W. Woolworth Co., and Robert Young, onetime partner of Frank Kolbe in Young, Kolbe & Co., were reticent about Mr. Kolbe's departure. All they would say was that part of Mr. Kolbe's share in the syndicate had been bought by Mrs. Young, who is the sister of Painter Georgia O'Keeffe, the remainder by a lawyer "for the personal holding com-pany of an undisclosed individual." While Wall Street ears tingled to talk that this unknown was either Amadeo Peter Giannini or John Jacob Astor III, in Cleveland the Alleghany Board met to discuss yet more simplification plans.

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