The Times Leader from Wilkes-Barre, Pennsylvania • Page 6

WILKES-BARRE RECORD, FRIDAY, MARCH ,16, 1945 1,1 set i I i Ti I 4 4 Ij'M This is No. 1 is series of statements published bj Federal Water and Gas Co poration to help supply iofonnatioa in connection with the possible public ownership of the water properties of the Scranton-Spring Brook Servica Company. 1 SW Communities Acauire Scranton-Spring Brook Water System Ahere has recently been some public discussion as to whether the communities served by Scranton-Spring Brook Water Service Company shall own and operate the water system which is the bulk of the Company's property Naturally some people are for it and others are against it. In order to help in clarifying this situation, so that all interested citizens may have as complete information as possible, we have decided to run a series of advertisements outlining some of the most important facts as we understand them Before doing this, we should like to make a few preliminary statements, so that nobody will misunderstand our position or motives. 1 Today Federal has a substantial direct and indirect interest in Scranton-Spring Brook, consisting of 100 of the Company's common stock, about 24 of the preferred stock, and a debt of $1,446,502.

described, we believe that the opportunity will be lost for the communities to acquire the water system. Hence this question has a "now-or-never" aspect quite beyond the control of Federal or the communities. 2. A reorganization of Scranton-Spring Brook is imminent, as 2. ordered by the Securities and Exchange Commission (a U.

Government agency), which has also ordered Federal to divest itself of any interest in Scranton-Spring Brook, to meet the requirements of the Public Utility Holding Company Act of 1 935. If this divestment is carried out, the new securities received in the reorganization will be widely distributed, and the ownership of Scranton-Spring Brook will be scattered among thousands of different security holders in various parts of the country. 3a This is of immediate interest to the communities for the following reason: We believe that the only practical way for the communi- ties to acquire the water system is to gain control of it by acquiring 100 of the common stock of Scranton-Spring Brook in a single block. This, is due chiefly to tax considerations affecting a sale of the water properties by Scranton-Spring Brook. If ownership of Scrantbn-Spring Brook becomes scattered as above We believe that a sale to the communities would be more ad-vantageous to Federal and all other Scranton-Spring Brook stockholders than the scattering of stock ownership following the proposed reorganization.

Federal is therefore like any individual with property for sale whether a house, or a coalminewe want to be sure that any prospective buyer knows all about the property before making up his mind. Consequently Federal is paying for these advertisements to supply information to the citizens of the communities which collectively represent a possible purchaser. Some people think that no bargain can ever benefit both parties. This we do not believe. It is possible that a sale advantageous to Scranton-Spring Brook stockholders would also be advantageous to the communities.

This will be discussed in a later advertisement. Any reader can judge for himself whether our statement of the case is sound from his point of view. Federal is not forced to sell to the communities, and the com- your waterworks It is one of the finest in the world and munities are not forced to buy. So there is an opportunity, an asset to your valleys. We believe that after the war, if prop-before the ownership of Scranton-Spring Brook becomes scat- erly used, it can be a potent factor in bringing new and divert! tered, to weigh the merits of the case in a fair-minded way, and fied industries to your communities.

find out whether we have a mutual interest. But whatever you do whether you elect to buy or continue. The next advertisement will appear in a few days and will to pay rent (so to speak) to an outside ownerdo not cry down describe the properties. 1 1 4 A IV AT A ft fl P. AT I i i i i i I' I1.