The Los Angeles Times from Los Angeles, California on May 16, 1969 · 59
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The Los Angeles Times from Los Angeles, California · 59

Los Angeles, California
Issue Date:
Friday, May 16, 1969
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Huge ;PaynSerit$''' :IMi.cit Discounted by Officials inance FRIDAY, MAY 16, 196? Part III 13 usinesis & r National News The FAA certified United Aircraft engines for the new Boeing 747 jet. The Pratt & Whitney Aircraft division of United announced that the FAA had certified its JT9D-3 jet engine. It will be used on the 747 jumbo jet scheduled to enter service later this year. There will be about a week's delay in the 747 testing program, Boeing said. The main shaft of the prototype engines produced by'Pratt & Whitney will be replaced with the heavier shaft used in the engines certified by the FAA. Cracks reportedly developed in some of the prototype engine shafts. Giffen Industries asked return of its down payment to buy Keller. Giffen filed suit in Dade County, Fla., circuit court to rescind its contract to purchase Keller Industries, and charged Keller with financial misrepresentation. Giffen asked for return of a $14.4 million down payment, and requested that it not be required to pay another $35 million due Jan. 12, 1970. Giffen was to pay $60 a share for 50 of Keller Industries stock. Both are Miami-based home building industry firms. The suit said that Keller reported net income of $2,282,000 before taxes for the first quarter of fiscal 1968, but deferred operating costs of $2,209,369. The suit said actual net income was $73,000, and questioned the cost deferment. Housing starts fell during April, but the six-month average jumped. The April rate of 1,543,000 units was 2 below the 1,580,000 unit rate posted during March. But the .average for the six-month period ended in April ran 11 ahead of the preceding six months and the same period a year ago. The number of new, privately-owned housing units authorized during April was up from the previous month. Starts of multi-unit structures (five or more) were on the upswing for the second straight month, while starts of single family dwellings and two-to-four-unit structures were declining. Commercial bank net reserves eased during the week ended Wednesday, The New' York Federal Reserve s Bank estimated that the banks averaged net borrowed reserves of $965 million during the statement week, down from a revised average of $1,159 billion in the previous week. Member bank borrowings from the Federal Reserve System averaged $1,170 billion, down from $1,603" billion the week before. Commercial and industrial loans at major New York City banks rose $21.4 million, compared with a rise of $15 million in the previous week and a gain of $22 million during the same week Of 1968. Retail saies increased slightly last week and 5 over the year. The total was $6,991 billion, reported the Commerce Department, up from $6,976 billion the previous week. Durable goods sales totaled $2,283 billion, also up 5 over the same period last year. Nondurable goods rose 5 to $4,708 billion . ., . Rail freight traffic was 15.1 billion ton-miles, down from 15.3 billion the week before, reported the Association of American Railroads. Ford said it will shut down the Long Beach plant during next week. Four other plants will be put on a four-day work schedule, apparently in a move to bring production into line with currently high inventories. Workers at Ford Assembly plants at Mahwah, N.J., and Wixom, Mich., will be laid off for one day on Monday. The Metuchen, N.J. and San Jose plants were scheduled to be closed on Friday, May 23. Meanwhile, U.S. producers turned out 165,864 cars this week, down from 166,335 last week. Ling-Temco-Yought said it controls 80 of Jones &Laughlin's stock. Clyde Skeen, president of the Dallas conglomerate, told San Fran-cico security, analysts that it now controls over 80 of the common stock of Jones & Laughlin Steel Corp. LTV has made an agreement with the Justice Department that it will freeze its holdings of the steel firm at 81, pending the outcome of the department's antitrust suit against the proposed merger. Skeen also repeated his forecast of a 30 increase in operational earnings for LTV in 1969. California International Controls revised its offer for Electronic Specialty. ' The proposed new package of International Controls securities to he exchanged for the Pasadena-based Electronic Specialty's com- mon stock will be at least equal to the original offer, the firms said. The previous proposal called for International Controls' $5 sinking - fund preference stock, warrants and common stock, to be exchanged at a total package value 5 above the average closing price of Electronic Specialty common. Directors of both firms are scheduled to meet Monday" to determine the specific propqsed terms of the new package. Imperial Corp. of America agreed to buy the major share of an S&L The San Diego-based holding company will acquire a 97interest in Southern California Savings & Loan Association, Los Angeles, from City Investing Co., Birmingham, Ala. Under terms of the 'proposal, Imperial would pay $30 million in cash and common stock to. Southern California Financial Corp., a wholly-owned subsidiary of City Investing, which holds the 97 interest in the savings and loan company. Imperial already owns 12 savings and loan associations in four states. Pacific Holding will buy McCarthy Co. for $6.5 million in stock. The holding company, formed from mergers of Pacific Clay Products, Armstrong Paint and Varnish Works, Inc. and Anaheim Union Water Cq., agreed in principle to acquire McCarthy, one of Southern California's leading residential real estate firms. The transaction was arranged through a transfer, of about $6.5 million in common stock, Pacific Holding announced. The company's immediate goal will be property development in Southern California. Briefly Told Merrill Lynch made an offer for Royal Securities Corp. . . . National Industries Inc. of Louisville, Ky., listed its shares on the Pacific Coast Stock Exchange ; . . Dean Witter opened a new office in the Whittier financial center ... An FPC examiner recommended that EI Paso Natural Gas Co. be allowed to raise charges to provide a 7 18 rate of return ... . American Optical Co. announced a consent decree enjoining former American employes now with Image Optics Inc. from disclosing proprietary information on' laser and fiber optics . . . Ogdensburg Trust Co. agreed in principle to join the Charter New York Corp. group "Of banks . . . Commonwealth United Corp. has completed the purchase of Tanforan Racing Association and Pacific Racing Association . j, . The CAB will hear oral arguments May 20 on the selection of a second airline to serve the South Pacific from points in the Eastern and Midwestern U.S. ... Electrical output of Southern California Edison Co. totaled 846,800,000 k.w.h. last week, up from 774,300,000 k.w.h. a year ago and 831,800,000 k,w.h..the previous week. 107 106 105 104 103 102 101 100 99 1941-4j 10) I 20 IS 16 14 12 10 IN Mil IONS iiili 111 44 4H 418 42 52 59 516 WEEKS ENDINO YESTERDAY NEW YORK Standard & Poor's 500-stock index closed at 105.85, down 0.31 from the 1969 high of 106.16 set Wednesday. High during the day was 106.69; the low, 1 05.08. The industrials closed at 1 1 5.83, down 0.41; the rails at 50.86, down 0.05; the utilities at 67.84, jp 0.21. The "500" 1969 low of 97.98 was set Feb. 25. Volume declined to 1 1,930,000 shares, compared to 14,360,000. OVER-THE-COUNTER The National Quotation Bureau index of 35 industrial stocks closed at 409.25, up 3.20. The 1969 high of 425.86 was set Jan. 6. The 1969 low of 384.35 was set March 7. LONDON The Financial Times index of 30 industrial stocks closed at a new 1 969 low of 422.2, off 1.6. The 1969 high of 520.1 -was set Jan. 15. SHAKE, PARTNER C. Peter McColough, left, president of Xerox Corp., greets Scientific Data Systems President Max Palevsky on stage at Century Plaza ballroom. SDS shareholders met at the hotel to vote approval of a merger with Xerox then joined the Xerox meeting down the hall where its holders also OKd merger. Times photo by Don Cormier Xerox, Scientific Data Holders Approve $910 Million Merger BY PAUL E. STEIGER Timts Stiff Writtr Shareholders of Xerox Corp. and Scientific Data Systems, holding their annual meetings in adjoining rooms in the Century Plaza Thursday, overwhelmingly approved the merger of El Segundo-based SDS into Xerox. As previously reported, the deal involves an exchange of stock valued at more than $910 million. Xerox, based in Rochester, N.Y., makes copying machines. SDS makes computers. Developing Color Copier Shareholders of the merged company (about 1,000 from Xerox and 300 from SDS) were told officially for the first time that the company is developing a xerographic color copying machine. And SDS President Max Palevsky, who will continue to head the computer-maker as a Xerox subsidiary, said that SDS now plans to enter the. highly competitive business computer field. In the past, SDS has concentrated on scientific computers. Xerox holders also approved a 3-for-1 stock split, effective today and to be distributed June 17. Both metings were the epitome of high-spirited conviviality. The SDS session concluded shortly after 10:30 a.m. whereupon its officers, directors and shareholders marched into Xerox1 hall and took their seats accompanied by loud applause. Throughout both meetings, shareholders asked few probing questions and offered several extravagant encomiums to management. A horde of hostesses stationed at various points in the audience proferred microphones to those wishing to be recognized and have their names read into the record. The proceedings were recorded by closed circuit television and by a wandering film crew. Box lunches (kosher and non-kosher) were served when the Home Savings Set fo Purchase S&L in S.F. Bay Area Home Savings & Loan Co. of Beverly Hills and Savings Financial Corp. have agreed on details of a previously announced plan for Home to purchase Savings Financial's principal subsidiary, Guarantee Savings & Loan Assn. of Livermore Valley. Richard Diehl, president of Home, Thursday announced his firm has been granted the right to buy all of Guarantee's stock at $15 a share, a total of more than $13 million. If the transaction is approved, it will mark Home's first move into Northern California. Guarantee has four offices in the San Francisco Bay area. Home Savings is a subsidiary of H. F. Ahmanson & Co., a privately held Los Angeles holding company., . At the same time, Savings Financial received the right to buy within a year about 500,000 shares of United Financial Corp. of California at $23 a share, a total cost of about $11.5 million. The block represents approximately 20 of United's stock. An Ahmanson trust owns the block of United which has assets of around $400 million. The transaction ' is subject to approval of directors of the firms involved. S&l 4T'' jjjj&F mi w J business of the Xerox meeting concluded shortly before 1. In response to a shareholder, query, Xerox President C. Peter McColough said the budget for the meeting was set at $80,000, although he said he didn't think it would cost quite that much. Archie R. McCardell, Xerox's executive vice president, - operations, told shareholders that the company may soon introduce two major new medical products, possibly in 1970. The first device, he said, is to be used to detect breast cancer.' The second combines biochemistry and sophisticated electronic instruments. McCardell also discussed the company's progress along two separate Please Turn to Page 22, Col. 7 Inflation Molding Up Housing Progress in U.S. Romney BY THOMAS W. BUSH Tim SttH Writtr CORONADO "So long as we are gripped by inflation, we are not going to meet our housing needs," George Romney, Secretary of Housing and Urban Development, said here Thursday. He cited two other obstacles to attainment of 1968 Housing Act goals fragmentation of - such resources as land regulations and people, and lack of money. The former Michigan-governor addressed the closing session of a 'two day meeting of the California Mortgage Bankers Assn. The housing, act set a goal of construction or rehabilitation of 26 million housing units during the next 10 years. Of these, 6 million would be for low or moderate income families. Citing inflation, Romney pointed out that it cost $400 more to buy a lot for an FHA-insured single-family home in 1968 than it did the year before. In March of this year, according to one index, it took $1.10 to buy as much construction as $1 bought a year earlier. Romney said inflation is. pricing would-be homeowners out of the housing market. It cuts production at a time when there is a severe housing shortage in many areas of Please Turn to Page 15, CoL 6 SNYDER JOINS IN CALIFORNIA PROJECT Loew's Plans BY RON S. HEINZEL Thntt Staff Writtr Loew's Theatres Inc. of New York Thursday annnouned plans to develop in a joint venture with J. H. Snyder Co. of, Los Angeles $200 million of homes and apartments in California. . The move marks Loew's entrance into the home building industry and is the initial step in plans to jointly develop homes and apartments from coast to coast Laurence A. Tisch, Loew's chairman, also announced his firm has purchased four properties in California for 64,000 shares of the firm's stock with a current market value of more than $3 million. National General Conducts Takeover Talks With Parvin BT JOHN A. JONES Tlmts Staff Writtr National General Corp., the movie theater operator, leisure time . and financial company which abandoned a plan . to acquire Warner Bros, early this year, is negotiating to take over Parvin-Dohrmann Co., a hotel supply firm and an operator of Las Vegas casinos which is under investigation by the Securities & Exchange Commission and the American Stock Exchange. Both firms are based in Los Angeles. A brief, two-paragraph announcement from Eugene V. Klein, president and chairman of NGC, and Delbert W. Coleman, chairman of Parvin-Dohrmann, said they "met to discuss the feasibility of National General's acquiring Parvin - Dohr-mann." The discussions are continuing, they said, but "many factors remain to be explored and various problems are as yet unresolved." Exploratory Talks Klein and Coleman stressed that their talks are only exploratory, and said that any arrangement they might develop "may require" approval of their companies' directors and "perhaps" their shareholders, as well as that of regulatory agencies including the Nevada Gaming Control Board. Neither Klein nor Coleman could be reached Thursday to elaborate. Klein was reported en route home from the East, and Coleman was reported "out of town." However, a Parvin-Dohrmann spokesman said that the meeting between Klein and Coleman started Wednesday afternoon in New York. The principal point discussed was whether Parvin-Dohrmann might be available for acquisition, the spokesman said. Apparently the. firm is available and National General is interested but he stressed that the talks are in very early stages. The Nevada board said Wednesday that it will not consider any new applications from Parvin-Dohrmann to operate casinos in Las Vegas in the near future, until the state agency has had time to study the operations of the three hotel-casinos Parvin-Dohrmann already owns. That would apparently rule out an early acquisition of the Riviera Hotel and casino, which Parvin-Dohrmann had planned to take over. The firm now operates, through a lease arrangement with another company, the Fremont, Alladin and Stardust hotels. The Nevada gaming board's scrutiny of Parvin-Dohrmann's operations and ownership centered on the recent purchase of 300,000 of its Please Turn to Page 15, Col. 3 Formation of Panel to Bridge Business, Consumer Gap Urged BY ROBERT E. DALLOS Tinm Staff Writtr NEW YORK Donald M. Kendall, chairman of President Nixon's National Alliance of Businessmen, called Thursday for the formation of a multi-industry coordinating committee to eliminate what he termed "a credibility gap between the business community and the consumer." Kendall, who is the president of PepsiCo, Inc., offered the suggestion in an address to the National Industrial Conference Board. The subject of a day long meeting held by the board was "The Consumer in the 70s." "By adopting a forward approach," he said, "by discussing ideas with' legislators before bills are proposed, by becoming an important force in the initiation of legislation, we can minimize the chances of being affected severely by unrealistic laws." Kendall said the committee pro $200 Million Housing Venture Jerome H. Snyder, president of the construction firm, said immediate plans call for development at the following sites: An 850-unit development in Beverly Glen Park, West Los Angeles. The project is part of a joint venture with U.S. Plywood-Champion Papers Inc. of New York. A 1,500-unit condominium in Cor-onadb. A 6-acre shopping center and. 600 residential flnits in Yorba Linda. Thirteen hundred single family units in South San Francisco. A 600-unit apartment development and shopping center and 150 single family homes in San Carlos. Accounting Methods r Blamed for Confusion on Quarterly Results 5 BY FRANK C. PORTER xetoilvt tt TO Tlmn from tin Wnhliwlon Port WASHINGTON The United States suffered both a huge deficit and surplus in its first quarter balance of payments, depending on which set of books one looks at, the government announced Thursday. The wide spread was attributable largely to differences in accounting ; for the big inflow of Eurodollars, into the country to satisfy unusually.' high demands for credit. Although Administration officials, found little to cheer about in the' figures, they appeared relatively, unperturbed by the second largest' quarterly deficit on record. 1 Liquidity Basis Deficit . On the so-called liquidity basis,; which measures foreign claims against the dollar in private as well as governmental hands, the outflow of dollars exceeded inflow by nearly, $1.8 billion during the January-March period after seasonal ad juste ment. But on the official accounts basis; which is confined to government and central banks transactions, the tide was reversed and a $1.1 billion surplus was recorded. William H. Chartener, assistant secretary of commerce for economic affairs, said the latter figure reflected a high level of confidence in the dollar on the part of foreign govern-; ments and central bankers. At the same time, Treasury Secretary David M. Kennedy said "the structure of our balance of payments remains unsatisfactory" and warned that "a quick and dramatic change. . . is not to be expected." .: The wide variance between the' liquidity and official transaction balances stems largely from the shortage of loanable funds in the United States. Big city banks called on their foreign branches for help. These branches borrowed large sums of Eurodollars U.S. money circulating in Europe which resulted in a big decrease in the dollar holdings of European central banks. Since these holdings are treated as liabilities against the United States, the decrease shows up as a plus on both the liquidity and official settlements accounts. Recorded as Debt ' When these branches transferred the Eurodollars to the United States, to accommodate the demand for. loans, the transfer was recorded not as an inflow of dollars, but as a debt to foreign lenders. Thus it shows up as a minus on the liquidity account. But it has no effect on the official transactions account, which ignores private transfers. In the quarter, American debt to foreign banks, mainly branches of U.S. banks, rose by $3.2 billion and $1.7 billion of this had a counterpart Please Turn to Page 22, Col. 8 posed would be fashioned after the Consumer Research Institute of the grocery industry. It. would, ha. urged, engage in research to antici-; pate consumer complaints, assess whether they are justified, devise means of coping with complaints f and it would also try to determine t how the industry's side can best be presented. The executive said that he would like to see organizations like the one formed by the grocers set up by every industry that deals with the i consumer and that the coordinating committee could then compare com- i mon interests and common prob- lems. ' "Until we really understand the motivations that develop into (con- sumer) boycotts," he said, "until we really spot in advance the causes fori pressure for legislation and picket-1 ing of retailers and manufacturers Please Turn to Page 22, CoL fj f "We are ontimistic as we take our first step in the home building f industry," Tisch said.. "We have! examined our potential for expan-l sion to other parts of the United States and we are confident the home buying public, which grow bigger each year with our expand-? ing population, will provide us withf a sizable market." Loew's operates 118 theaters, 15 hotels and motels and produces tobacco products and pet foods, through its wholly owned subsidia- ry, Lorillard Corp. 9 Snyder has built more than 15,000 homes in the Southland with a value in excess of $150 million. 1

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