Word: penns
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Dates: during 1950-1959
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Such tactics were heavily criticized by Washington Attorney Alfons Landa, a Penn-Texas shareholder and expert proxy fighter (TIME, Dec. 17). He heads a Penn-Texas "protective committee," financed with $80,000 from Robert Morse Jr., which was formed to start a backfire and perhaps oust Silberstein from his own company. Landa charged that Silberstein himself has shared secretly in huge, illegal profits from his stock deals, is putting Penn-Texas in the hole by overborrowing and selling off company assets to finance the campaign against Morse. Some examples...
...selling off the property of a Penn-Texas subsidiary, Colt's Patent Firearms of Hartford, Conn., Silberstein raised $2,000,000 in cash, then leased back the plant at $231,264 a year for 20 years-or a total...
Under oath before SEC, Silberstein angrily denied any personal profit, said that his operations are perfectly legal methods of buying stock without paying more cash than Penn-Texas can afford. The stock, said he, was bought through the web of intermediaries to 1) avoid pushing the open-market price higher, and 2) get it from sources who would sell it on credit or agree to later delivery and payment. Despite the high premiums, said Silberstein, Penn-Texas bought Fairbanks, Morse stock (now about $57) at an average $52 a share...
...Penn-Texas has spent about $17 million for F-M stock, owes "under $18 million." The stock buying has not helped Penn-Texas' own stock. From a high of $22 it is down to $12-even though the company's net income rose to $4,813,000 (including $1,390,000 from the sale of fixed assets and tax credits) in the first nine months of 1956 v. only $1,940,000 for all of 1955. To buy control of Fairbanks, Morse with a total $35 million, insists Silberstein, "is what I call a smart investment. The company...
...Silberstein does succeed in his goal-electing six directors to the eleven-man Fairbanks, Morse board-his victory might yet be Pyrrhic. Penn-Texas may control Fairbanks, Morse, but since Illinois law requires a two-thirds vote of shares for corporate merger, the Morse family holdings are enough to block any real union between the two companies. Moreover, if F-M stock drops after Silberstein wins-and Morse himself says it is much too high-the Morse-financed Landa committee may yet put Silberstein in hot water at Penn-Texas' own meeting in May by confronting him with some...