The Los Angeles Times from Los Angeles, California on April 11, 1969 · 64
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The Los Angeles Times from Los Angeles, California · 64

Los Angeles, California
Issue Date:
Friday, April 11, 1969
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y ' y "-e V"- err 5 State Dept. Intervention usiness & finance in Litton 14 Part III FRIDAY,APR!L11,I94? Hearing Told National News Retail taiet sained 6 last week and set a new record for March. The total was $7,179 billion In the last week before Easter, the Commerce Department said, up 6 from the week before and 13 ahead of a year ago, when Easter came later in ApriL Durable goods sales totaled $2,219 billion, up 12, and non-durables advanced 13 to $4,960 billion. Retail sales in March rose 1 after seasonal adjustment for a record total of $29,585 billion. Rail freight traffic last week, at 14.4 billion ton-miles, fell 3.4 from the previous week but was 4.3 above the corresponding week of 1968. Intercity truck tonnage fell 4.9 from the week before and 1 from a year ago. The commercial banks' net reserve position eased in the past week. The New York Federal Reserve Bank estimated the banks' average net borrowed reserves at $789 million in the statement week ended Wednesday, compared with a revised average of $938 million in the previous week. Member bank borrowings from the Federal Reserve System averaged $947 million in the week, down from the $1,195 billion of the week before. Commercial and industrial loans at major New York City banks fell $54 million in the week, compared with a rise of $7 million in the previous week and a decline of $40 million in the 1968 week. The SEC suspended trading in the rising Photo Mark Computer stock. The New York-based firm's stock has experienced a meteoric rise in price. Photo Mark Class A shares shot from 50 cents in October to $13 one month later and has currently been quoted at IOV2 bid, 11V offered, the class B shares have risen to $6 from $2. The SEC said there appeared to be a lack of complete and accurate Information for investors about the company and its acquisition program. The agency also cited reports that unregistered snares were being sold. Chrysler said it plans to reopen its assembly plant in Ontario. Chrysler said it would reopen Monday its Windsor, Ontario, assembly plant and spring plant. They were among several facilities closed by a parts shortage due to an unauthorized strike at a Chrysler stamping plant that ended Thursday. A spokesman said three Detroit assembly plants would probably remain closed the remainder of this week. The Aiax, Ontario, metal plant will reopen Wednesday. No decision has been made when to return parts of, the work force laid off at Chrysler's Twinsburg, Ohio, stamping plant, a Detroit glass plant and a Detroit engine plant. U.S. auto makers posted higher production schedules this week. jThe manufacturers expect to build 13,996 cars in domestic plants this week, up from 142,118 last week and 126,147 a year ago. Chrysler planned 1$,200 cars this week, down from 23,323 last week and 20,012 a year ago. General Motors scheduled 99,-154 cars, up from 77,990 last week and 68,981 last year. Ford slated 43,250 assemblies this week, up from 35,763 last week and 32,870 a year ago. American Motors scheduled 6,392 units this week, up from 5,042 last week and 4,284 last year. j Allis-Chalmers was accused of a 'credibility gap' in forecasts. E. S. Reddig, president of White Consolidated Industries, charged in a, letter to Allis-Chalmers stockholders that the Allis management left the gap between its predictions and actual performance. He referred to the company's pretax loss of $122 million in 1968, and said the company indicated in October, 1968, that its pretax los3 would be about $50 million. White, a Cleveland-based conglomerate, Is trying to take over Allis-Chalmers, the Milwaukee machinery manufacturer, and has nominated nine members for election to Allis-Chalmers1 12-man board. i U.S. Freight and Tropical Gas Co. agreed on a proposal to merge. ;The agreement calls for U.S. Freight, the giant freight forwarding concern, to .89 share of itp common stock for each share of Tropical Gas common. At current prices the transaction would be worth more than $39 million. Tropical Gas, based In Coral Gables, Fla., retails and wholesales liquid petroleum gas. The transaction is eipected to be tax-free. A definitive a jreement is to be submitted to the directors of each company soon and Will be subject also to the approval of both firms' stockholders. California CBS acquired 2 community antenna ystem companies in Marin County. J The broadcast network said It acquired Clear View Cable Systems Inc. and Marin Cable Television Inc. ' in an exchange of 51,510 shares of CBS common stock, worth some $2.8 million. The antenna companies have a total of 7,500 subscribers. CBS also said it filed a registration statement with the Securities & Exchange Commission in connection with a contemplated offer of 346,415 shares of CBS common stock, plus up to 78,868 additional shares, for Tele-Vue Systems Inc. The transaction could be worth up to $21.3 million, at current stock prices. Tele-Vue and its subsidiaries operate CATV systems in California and the state of Washington. Crocker-Citizens dropped its plans to acquira Bank of Sonoma County. Directors of both banks said they will abandon their proposed merger since the Justice Department filed suit in U.S. District Court in San Francisco contesting it. Crocker-Citizens noted that once the suit was filed the Justice Department was afforded an automatic stay of the merger until all issues raised in the suit have been resolved. Neither bank wishes to undertake the protracted and expensive litigation that would be involved in defending the view that the merger would not violate antitrust laws, said Emmett G. Solomon, chairman of Crocker-Citizens. Men at the Top John E. Leslie was appointed as the new chairman of Bache & Co. Leslie will assume the office May 1. He is currently vice chairman of the major investment house. He succeeds George Weiss, who is retiring but who will continue as honorary chairman and as a director. Briefly Told Occidental Petroleum expects first-quarter earnings to be more .than double the 36 cents per share of the 1968 quarter . . . Sealed Power Corp. expects 60 cents per share earnings in the first quarter vs. 46 cents a year ago. Shareholders of Smith Industries International Inc. voted to change the corporate name to Smith International Inc. . . . Equity Funding Corp. of America agreed to acquire Ankony Angus, a privately held cattle firm, for $13 million in cash and stock . . . United Fruit Co. broke off its merger talks with Garden State Racing Assn. of New Jersey, and postponed its annual meeting from April 16 to some time in June . . . The Amex suspended trading in Nuclear Corp. of America bY2 convertible subordinated debentures . . . Avco Corp. estimated that 80 of its profits will come from commercial operations in 1969, vs. less than half of earnings reported in 1964 when a drive to reduce dependence on government sales began . . . Household Finance expects to get half its revenues from merchandising and manufacturing within five years . . . Lucky Stores Inc. sold all its Blue Chip Stamps common stock to a private investor for $2.5 million. 103 102 101 100 98 97 1 wi 16 14 12 10 t 228 37 3M 321 328 44 411 WIIKS INDINO tISTIRDAY- NEW YORK-Stondard & Poor's 500-ttock Index closed ot 101.55, up 0.53. High during the day wos 102.22; th low, 100.73. Tht Industrials closed at 1 1 1 .03, up 0.63; the rails at 49.93, off 0.20; the utilities at 65.42, up 0.11. The "500" 1969 high of 103.99 was set Jan. 3. The 1969 low of 97.98 was set Feb. 25. Volume declined to 12,200,000 shares, compared with 1 2,530,-000. OVIR-THI-COUNTIR-The National Quo. , tation Bureau Index of 35 Industrial stocks doted ot 392.30, up 1.43. The 1969 high of 425.86 was set Jan. 6. The 1969 low of 384.33 was set March 7. LONDON The Financial Timet Index of 30 Industrial stocks doted ot 474.7, up 2.5. The 1969 high of 520.1 wos set Jan. 15. The 1969 low of 458.2 wos set March 18. .:m. iv ' jl . ... s ' ' is : 4, v yfr ' vf;r iff 0j n FULL LOAD OF PASSENGERS? Boeing Co. has mounted more than 175 containers like these in its new 747 jetliner as part of flight testing. The ballast method shows the effect on flight stability of weight and center-of-gravity changes in the huge passenger plane. Boeing Barrels Big 747 Around to Get Proof of Performance Boeing Co. is busy flying around these days with what appears to be an airborne still but the revenoo-ers aren't on its tail. It's all part of a very serious flight test program for its 747 "superjet" airliner. By the time the program is over, the Seattle-based company says, the 747 will be "the most thoroughly tested jetliner ever to enter commercial service." Before the first 747 takes off in Pan American livery (the inaugural flight has been tentatively set for mid-December), Boeing will have flown five of the craft a total of 1,400 hours more test time, it says, than was logged on any prior aircraft. The plane now being used for testing carries 60,000 pounds of flight test equipment. It has four movie cameras, three tape recording systems, four oscillographs, and an on-board computer collecting and analyzing data on each flight. The B of A Posts 11.5 Boost in Earnings for First Quarter BY JOHN GETZE Tinwt Staff Writtr Bank of America said Thursday its consolidated net operating earnings for the first quarter of 1969 climbed to $36,631,000 or $1.07 per share, up from $32,845,000 'or 96 cents pert share in the first three months a' year ago. This was a gain of 11.5. ' The world's largest non-government bank reported that total resources, as of March 31, stood at $23,993,089,000, an increase of 9.8 in the past 12 months. The current figure is down, however, from the $24,163,336,000 asset mark reported as of Dec. 31, 1968. Other operating results as of March 31 were as follows: Total deposits reached $21,079,-471,000, up 8.8 from the previous year's figure. Loans totaled $13,695,647,000 as against $12,126,324,000 last March ' 31. Investments in securities totaled $4,390,995,000, of which $1,922,703,-, 000 represented direct or guaranteed obligations of the U.S. government. During the quarter, transactions in securities resulted in a net loss of $2,041,000. Provision for the loan loss reserve and other nonoperating deductions amounted to $4,073,000, after resulting tax credit, leaving $30,517,000 available for dividends and addition to capital funds. RATE HIKES NOT CHECKING INFLATION Banks Must BY ARELO SEDERBERG Timet Staff Mrltar A Los Angeles bank economist Thursday chided the banking industry for not reducing lending activity as a weapon against inflation. "It is becoming crystal clear that Inflation will not be checked by raising Interest rates on the part of monetary authorities or the banking Industry," Bald Dr. Ray Jallow, vice E resident and chief economist for 'nited California Bank. "It is time for banks to effectively and earnestly reduce their lending, and they must consistently nay 'no' to every loan that is intended to b used for apeculatlve or non-productive purposes. It Is up to banks to addition of about 100 miles of special wiring for test purposes aboard the craft nearly doubles the 747's normal complement of wiring. More than 175 ballast containers, each a barrel with 55 gallons capacity, are mounted in the two lower deck cargo compartments and on the main flight deck behind the wings. To compensate for fuel usage or to maintain a certain center of gravity for flight testing, the test engineers put varying amounts of water in the different barrels. This enables them to determine how changes in weight and center of gravity affect the huge jet's flying stability. When fully laden, the barrels add 80,000 pounds to the load. A time-code generator steadily Inserts on all the film and tape recordings the precise time of day, down to the second, with an accuracy of l100th of a second. This enables test engineers to coordinate all readings from the various recording systems. The film and tape systems record such events as the activity of the flight crew, instrument readings, stress and vibration, changes in landing gear loads, the action of moving parts on the wings, engine pressure ratios, rotor speeds, fuel flow and exhaust ga3 temperatures. To measure air pressure at a point where it isn't affected by the jet's own slipstream, Boeing engineers suspend two devices on cables from the craft, each 250 feet below or behind the airplane. This is necessary to enable the engineers to calibrate the craft's air speed indicators. International Industries to Buy Ramada Inns for $220 Million BY RON S. HEINZEL TlmMlUff Wrlhr International Industries Inc. of Beverly Hills and Ramada Inns Inc. of Phoenix Thursday announced reaching an agreement In principle for International to acquire Ramada through an exchange of stock with a market value in excess of $220 million. In a joint announcement, Al Lapin Jr., president of International, and Marion W. Isbell, Ramada chairman, said the agreement calls for International to exchange $33 in market value of its common shares for each Ramada common share. As of Dec. 31, 1968 there were 6,689,347 Ramada shares outstanding, adjusted for a recent 3-for-2 stock split. Based on that figure, the total Ration Loans, Economist Says 1 ration their, credit before somebody else imposes it on them." He spoke to the California Bank- ' ers Assn. at the Beverly Hilton. Jallow termed the argument that 1( economic activity can be reduced by 'Increasing interest rates "a myth that must be dispelled." In an inflationary economy, the theory is particularly invalid, he Baid, because all sectors of the economy increase their demand for funds as a hedge against rising prices. (Heinz II. Biel, market analyst for the investment firm of Emanuel, Dcetjen & Co. in New York, expresses the same sentiment: "So long as ' the government, under present tax laws, absorbs more than half the Slick Corp., Filfrol Reach Accord on Proxy Fight Respite BY PAUL E. STEIGER ThnM Staff Wrifer New York-based Slick Corp. and Its aggressively, resistant merger target, Filtrol Corp., have agreed to a brief, partial hiatus in their proxy battle. The result could be a postponement of Filtrol's annual meeting, now scheduled for April 29. The agreement relates to a civil antitrust suit that Filtrol, a maker of catalysts and refining agents for the food and petroleum industries, filed in U.S. District Court in Los Angeles April 1. The suit charges that acquisition of the Los Angeles-based company by Slick would illegally restrain competition. Slick, which makes chemicals and food products, is a customer and competitor of Filtrol in some fields. Through a tender offer ended March 21, it claims to control more than 50 of Filtrol's stock. The agreement between Slick and Filtrol, approved by a federal judge late Wednesday, calls for Slick to refrain from trying to acquire additional Filtrol shares or proxies until the court rules on Filtrol's request for a preliminary injunction. If granted, the injunction would prohibit Slick from either voting the Filtrol shares it already has or calling a special meeting of Filtrol shareholders. Answer Time Extended The agreement also extends to Monday the time for Slick to file an answer to Filtrol's request for the preliminary injunction and gives Filtrol until the following Friday to submit a rejoinder. After that, the court will set a time for a hearing on the injunction request, and if "appropriate,'' the annual meeting will be postponed, the agreement states. Under the agreement, Slick further promises not to dispose of any of its Filtrol stock pending the ruling on the request for the preliminary injunction. Filtrol at the same time agrees not to "take any action which could adversely affect or dilute the rights and interests of (Slick) as stockholders of Filtrol." In addition to the preliminary injunction, Filtrol's management, headed by Chairman Myron A. Bant re 11, is ultimately seeking through its suit to force Slick to divest, under a court approved plan, all its Filtrol stock. In a brief press release earlier this week, Slick said its attorneys feel the Filtrol suit i3 "without merit." Slick sought the agreement to give its lawyers more time to prepare a response to the suit. The agreement notes that top Slick officials "have been occupied at the company offices in New York getting ready (Slick's) annual report . . . and (have been) largely unavailable to furnish essential information to their counsel . . ." package would amount to $220,784,-451. The ratio of shares to be exchanged will be based on the average closing price of International on the New York Stock Exchange during a 10-day period preceding the required shareholders' meetings. The ratio ranges between a maximum of 0.61 share and a minimum of 0.475 share of International common for each Ramada share. In addition to shareholder approval, the acquisition is subject to execution of a definitive agreement and approval by the boards of both firms. No date has been set for the shareholders meetings. Lapin said, "International's successful record of growth in food Please Turn to Page 17, Col. 7 cost of borrowing money, even an 8 Interest rata is 'cheap' when one expects inflation to continue. If one anticipates construction costs to rise at 5, corporate capital expenditures Bhould not be deferred. By the same token . . . any tax-paying lender should have his head examined If he lends money for as little as 8.") , Banks have raised their prime rate best rate to their most creditworthy customers to a record high of 7.5. Jallow said a further increase "would not be in the interest of the banking Industry nor the nation as a whole." It would cause another round of Please Turn to Pag;e 13, Col. 9 FTC Pushes Action 7 on Divestiture Amid Conflicting Remarks BT ROBERT L. JACKSON Time Stiff Writer WASHINGTON The Federal Trade Commission moved Thursday to seek divestiture of two German typewriter companies by Litton Industries Inc. amid conflicting versions of unusual State Depart ment intervention on Litton's be- ' half. i During a rare open hearing before all five FTC commissioners, Litton's senior executive vice president, Harry J. Gray, testified his company received a telegram from the U.S. Embassy in Bonn expressing "strong objections" to the openness of the hearing. The reference to State Department Involvement in the case, particularly a private telegram from an ' embassy, surprised Commission Chairman Paul Rand Dixon, who asked that it be placed in the record. Gray complied. Ash Named by President ' ' 1 Litton, the nation's 14th largest military contractor, has close ties to the White House. Its president, Roy 1 L. Ash, was named by President Nixon last Saturday to head a "thorough" organizational review of the executive branch of. the U.S. government. A Litton director, Hen- ' ry J. Salvatori of Los Angeles, was among Mr. Nixon's largest campaign donors. Commissioner Philip Elman elicited testimony from Gray that the "telegram" from the embassy was received by Litton's office in Zurich. That office, in turn, telephoned the text of it to U.S. executives Thursday, Gray said. A State Department spokesman confirmed later that the department contacted the FTC "several times" recently to request a closed hearing. The department felt, he said, that publicity about the antitrust case might needlessly upset investor! and employes of the German typewriter companies if the FTC, at a later date, decided to drop the matter. But the State Department spokes-; 1 man denied, after checking with the embassy in Bonn, that the embassy had sent Litton a telegram. Gray had testified the telegram expressed "strong objections of the Department of State," and that It said: "The U.S. Embassy is prepared to give any and all possible assistance and support which Litton may Please Turn to Page 20, Col. T Market Manages to Advance Despite Late Profit-Taking NEW YORK (A Profit-taking sliced into the stock market's latest advance Thursday, but the market managed to turn in another winning performance it3 third straight. The Dow Jones industrial average racked up more than 6 points in early trading activity, but the gain was whittled later in the session and the Dow closed at 932.89, up 2.92 points. Gains led losses by 400 issues and more early, but this also was whittled near the end. Of 1,567 -issues traded on the New York Stock Exchange, 779 finished higher and 541 lower. New highs for the year totaled 56 and new lows 76. A spurt of profit-taking late in the cession was blamed by brokers for chopping the market's gains as well as selling by investors raising money to pay their income taxes. They said the market's upside move partly was a continuation of Wednesday's Vietnam peace hope drive that sent the Dow up 6.80 points and gave the market its best volume, 12.53 million chares, since Feb. 24. Volume Thursday was 12.2 million shares. "The market's still drawing some strength from peace hopes," . an . analyst said, "and they have dislodged some of the money that was standing on the sidelines, but there's still a lot of cash sitting idle Please Turn to Page 15, CoL S PARVIN, DOHRMANN SEEKS TO ACQUIRE LAS VEGAS RIVIERA Parvin, Dohrmann Co. has opened negotiations to acquire the Riviera Hotel and Casino in Las Vegas, President William C. Scott laid Thursday. The company now owns and operates the Fremont, Aladdin and Stardust hotels and casinos in Las Vegas. It had been rumored for several weeks that Parvin, Dohrmann vru seeking a fourth facility In Lai Vegas. 1 lA41VlStsXlsjiPfffcjjf

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