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ASSAILS TROLLEY HOLDING COMPANY AS 'EXPLOITATION' Henry S. Priest Asserts Delaware Concern Is 'Tramp Corporation'-Calls Plan a 'Delusion.' SAYS PRESENT FIRM IS BETTER FINANCED Minority Stockholders' Counsel Declares No Benefit to Public Service Co. Is Assured. By the Jefferson City Correspondent of the Post-Dispatch. JEFFERSON CITY, Sept. 22.The proposed transfer of stock control of the St. Louis Public Service Company to a Delaware holding company is declared contrary to public policy in Missouri, and is alleged to be a scheme for "exploitation" of the street railways by a few individuals. with a minimum investment. in it brief filed today with the Public Service Commission by former Judge Henry S. Priest, attorney for a minority group of Public Service Company stockholders. Priest charged the holding nompany. the City Utilities Company, would be able through its plan of stock control, to force Jpon the Public Service Company any special service or advice it saw fit to impose, and at any cost it might choose. with no assurance of benefits to the operating company. His brief is in opposition to the application of the holding company. which was organized by J. K. Newman of New York and his associates In reorganization of the St. Louis street railways, to acquire and hold more than 10 per cent of the stock of the operating company The holding company proposes to acquire slightly less than 50 per cent of the common stock and 35,000 of the 73,000 out. standing shares of preferred stock of the St. Louis Public Service Company. Beyond Reach of Commission Granting of application would place control of the management of the operating company in the hands of the holding company. The holding company itself would not be subject to regulation by the Public Service Commission of Missouri. A motion by Priest to reopen the hearings and to summon Newman and other stockholders of the holding company for questioning is pending before the Commission. Newman and his assistants in the reorganization now are in control of the Public Service Co., but seek to transfer their holdings to the holding company. The grounds offered in support of the application were that the holding company could render financial, managerial. supervisory and technical assistance to the operating company. Priest declared the holding company had made no showing that it could turnish such service. or that it was necessary. He said the commission would have no power to enforce their performance, once the control was acquired. Calls It "Tramp Corporation." The brief characterized the holding company as a "tramp" corporation. "with a roving commission to go anywhere and everywhere to aid by advice and credit any lame or halting public enterprize that may enlist its affection." "St. Louis seems to be a favorite feeding grounds for these migratory birds." he said. "It does not appear that the city or the Public Service Co. has called for its aid, or needs It." Discussing the section of the Public Service Commission law which requires approval of the commission before corporation may acquire more than 10 per cent of the stock of a public utility. Priest said it defined the public policy as limiting the amount of stock that may be acquired in this manner. Holding Company Owes. He said there was no showing that the Public Service Co. needed financial aid, and declared that If it was needed. the holding company apparently was less able than the operating company to obtain it. He said the holding company appeared to have received $2,418.632 for Its outstanding stock. but asserted it owed $3,642,887 to banks in St. Louis and New York. "How is there any assurance that It has better resources of credit than the Public Service Co., whose shares of stock constitute its (the holding compan only assets. Priest said. He clared the plan was "delusion to the sharehold. ers of the Public Service Co., "in that It would impose upon the dividends they otherwise would ceive the heavy burden of the expense of the management of the holding company Run on Illinois Bank Checked. FREEPORT. III. Sept. 22-A run on the Second National Pass of Freeport this morning au quickly checked when officials announced that all depositers ould be paid on demand. Bank officers said there was no foundation for the rumer that crassed depositors to call for money
