Warburg
($44-1/4--$130)
Holding company
Bydale Company
Fontenoy Corporation
(Both of these holdings are
reduced from originals)
($19-3/8--$31-5/8)
International Business Machines ($404-$549)
Arthur K.
($44-1/4--$130)
Holding company
Bydale Company
Fontenoy Corporation
(Both of these holdings are
reduced from originals)
($19-3/8--$31-5/8)
International Business Machines ($404-$549)
Arthur K.
Lundberg - The-Rich-and-the-Super-Rich-by-Ferdinand-Lundberg
du Pont de Nemours.
The SEC reports do not show holdings for Du Ponts in other companies where they are not officers, do not own more than 10 per cent individually, or have not engaged in stock transactions. But that they are interested personally in other companies is shown by the September, 1965, Official Summary where Henry B. du Pont is reported holding 6,000 shares in Remington Arms after selling 500 shares. E. I. du Pont de Nemours owns 60 per cent of Remington common and 99. 6 per cent of the preferred. Transactions were not traced for this study in companies like U. S. Rubber and Phillips Petroleum, where Du Pont interests are represented on the boards of directors.
But in Remington Arms another big old-line family holding was shown in the December, 1961, report for M. Hartley Dodge, son of the founder, who was reported as retaining 510,787 shares after selling 9,072 shares to other members of his family. Mr. Dodge, son-in-law of William Rockefeller, held 50,000 additional Remington Arms shares through a holding company and 28,407 shares in a trust fund. (The SEC reports provide similar information on the other old-line wealthy families: Phipps, Clark, Danforth, Knudsen, Baker, Anderson-Clayton, Dollar, Fisher, Heinz, Swift, Prince, Pew, Harriman, Block, Ryerson, Pitcairn, Hanna, Levis, Warburg, Kresge, Timken, Armour, Grace, Bedford, Firestone, Rosenwald, Colgate, Peet, Milbank, Crocker, Jennings, Olmsted, Cudahy, Havemever, Cabot, Lehman, Woolworth, Gimbel, Jones- Laughlin, Candler, Rosengarten, Hochschild, Wrigley, Rosenstiel, Reynolds, and others. )
With very few exceptions, and a few additions, the roll that was called in the formidable TNEC study is echoed and reechoed today in the SEC monthly reports.
What has been proved in these foregoing pages? Not very much, one would be forced to agree: Merely that the Du Ponts are still alive and thriving and are richer and more powerful today than they were in 1940. And one can predict that they will continue to grow richer and more powerful as long as the continually amended New Deal, Square Deal, New Frontier and Great Society politico-economic synthesis prevails.
The Ford Family
There isn't much doubt about the financial endurance of the Ford family, because the holdings of Henry and Edsel Ford were transferred only after 1947 to the present heirs. Those who believe they may be suffering extinction under the impact of metaphorically brutal taxes or other forces may gain reassurance from recent records.
The Fords did not turn up in the SEC reports until September, 1956, when it was shown that Benson Ford held 1,025,915 shares of Ford Motor Class B stock and Henry Ford II held 1,055,346 of the Class B. The Class B stock, all of which went to the Fords, holds 40 per cent of the voting power. The way this Class B holding came to the SEC record was explained as follows: "Reported that by the terms of a trust created by a relative, Benson Ford and Henry Ford II had in common with two others an option expiring 6/26/56 to acquire 15000 shares of Class B stock. Benson Ford, on 6/20/56, by gift, delivered an assignment of his portion (3750 shares) of the option. On 6/26/56 Henry Ford II, for a consideration, delivered an assignment of his portion (3750 shares) of the option. "
In the February, 1957, Official Summary it was reported that Henry Ford II disposed of 9,000 shares of Class B and in September, 1957, it was shown that he disposed of 100,000 shares and acquired 100,000 shares of the common. The March, 1959, report showed him disposing of 19,415 Class B shares in a private sale and that he had established a holding company that owned 3,284 shares; he retained 815,901 Class B shares at this point. By September, 1959, he had reduced his common holdings to 90,500 shares.
As of September, 1964, Henry Ford II no longer held any common in his own name but did hold 43,846 shares through a trust.
In March, 1964, it was reported that he now owned 1,319,576 Class B shares, held 75,000 B shares in trust, 12,000 B shares through holding companies and was trustee for 316,398 B shares. He now held 99,846 common -shares in a trust.
In January, 1962, it was reported that Benson Ford had reduced his direct holdings of the Class B to 894,147 shares but indirectly held 5,987 in holding companies and 105,456 in trust.
These are the latest positions through 1965 shown for the two men. No positions are shown for William or Charlotte Ford, which presumably were originally identical.
As reported earlier in this account, the Ford family effectively controls the Ford Motor Company and would continue to control it even if a considerable amount of additional common stock were given voting power through sale by the Ford Foundation.
The Mellon Family
The SEC report of March, 1965, showed Richard King Mellon clearing out his last 100 shares of Aluminum Company of America $3. 75 cumulative preferred stock, leaving his holdings in this issue at zero. In July, 1963, however, he was shown as holding 861,200 common shares of Alcoa ($61-1/2-$79-5/8) ) after disposing of 291,552 shares. Alcoa is the world's largest aluminum producer. And in June, 1963, he retained 2,809,922 shares of Gulf Oil ($87-$94-1/4) ) after disposing of 1,943,580. But in July, 1961, he held 4,666,929 shares of Gulf after selling 400,000 shares.
On the basis of the above facts one might reasonably conclude that the Mellons were still flourishing, without taking into account their other manifestations in the form of directorships and the like.
But a more positive showing can be made. In December, 1945, according to SEC reports, some years before six-for-one stock splits, Richard King Mellon owned 1,070,637 shares of Gulf Oil, and his sister, Sarah Mellon Scaife (who died late in 1965) owned 1,041,144 shares. Donaldson Brown of General Motors and Du Pont intermarriage owned 100 shares of Gulf Oil in July, 1947, and held 93,400 through the Broseco Corporation. Alan M. Scaife owned 9,300 shares of Gulf Oil, according to the January 10, 1949, SEC report, and by January, 1950, had raised his holding to 10,300 shares. He owned 30,600 shares in June, 1951.
Down through the years various other transactions in Gulf Oil and Alcoa are shown for this branch of the Mellon family but there is no present point in tracing them; the Mellons are, obviously, still in the ascendant.
The SEC reports show no transactions since 1945 in Gulf Oil or Alcoa for Paul or Ailsa Mellon or transactions for either of these two Mellons in the securities of any companies since 1960. Paul Mellon has been less active than his older cousin in corporate affairs, has more particularly applied himself to foundation and cultural affairs.
The TNEC study found that this clan had a finger in some hundred companies. Even if one had records of recent transactions in them all it would be awkward to set them forth. Exposition is defeated by the very extent of holdings. Recent SEC reports show, for example, that the Consolidation Coal Company, formerly the Pittsburgh Coal Company, of which Richard, Paul, Sarah and Ailsa Mellon owned more than 50 per cent (according to the TNEC study), now holds a 7 per cent interest in the Chrysler Corporation. To trace all such ramifications would be a virtually endless task.
Nor can we undertake to scrutinize all overlappings of large interests. The M. A. Hanna Company is a very large stockholder in Consolidation Coal, the SEC reports, and has heavy investments in many other large companies. H. Barksdale Brown, of the Du Pont clan, owns 3,317 shares of Gulf Oil (SEC, May, 1965); and the Broseco Corporation, instrument of the Brown family, held 666,684 shares on that date. We have already seen that Donaldson Brown, former high General Motors executive, and the Broseco Corporation are heavy stockholders in E. I. du Pont de Nemours. Donaldson Brown and the Broseco Corporation are also substantial stockholders in General Motors (SEC, October, 1950). Down through the years there has been much talk, much of it uninformed, about interlocking directorships. It is more significant that there is a great deal of interlocking ownership among the big interests.
The Pew Family
The TNEC study found the Pew family of Philadelphia in firm ownershipcontrol of the huge Sun Oil Company ($56-5/8-$67-3/4). Recent SEC reports confirm that the family is still in charge with a large dominant interest, 41. 5 per cent. John G. Pew recently held 44,139 shares (September, 1965). Arthur E. Pew, Jr. , held 37,170 shares and a John G. Pew trust 217 shares (December, 1964). Walter C. Pew held 434,214 shares (November, 1964). J. Howard Pew held 794,416 shares (April, 1964). A trust for A. E. Pew, Jr. , held 32,207 shares (November, 1963). J. N. Pew, Jr. , held 647,335 shares (November, 1960). And so on. Whatever the precise Pew ownership position is at any given time, one is obliged to conclude that the Pews are still in full charge of the Sun Oil Company.
The Pitcairn Family
This Pennsylvania family, shown by the TNEC study to dominate the giant Pittsburgh Plate Glass Company ($67-1/4-$85), in the SEC report for August, 1965, was shown to still hold 3,121,296 shares (about 30 per cent) through the Pitcairn Company, the family holding company. Nathan Pitcairn, according to SEC reports (August, 1963) owned 2,912 shares of the Pittston Company ($23-1/8-$32-3/8), big coal, oil and transportation holding company; and the Pitcairn Company held 42,000 shares of Pittston, Whatever else they own the available record showeth not.
The Rockefeller Family
The SEC reports fail to show any dealings in any of the Standard Oil Company stocks by the six leading Rockefellers since 1940. This lacuna is perhaps to be expected, as none of them is a director in the Standard Oil cluster and apparently none individually owns as much as 10 per cent of any Standard Oil stock. As far as the SEC reports show, the Rockefeller position in the Standard Oil group has remained basically unchanged since the time of the TNEC study, although there could have been sales or purchases without their being reflected in the SEC reports. There were indeed sales of Socony in the early 1950's by the late John D. Rockefeller, Jr.
The SEC report for July 10, 1947, showed the Rockefeller Foundation holding 345,902 shares of Standard Oil of Ohio after selling 6,782 shares. Various SEC reports show recent holdings for old-line Standard Oil families such as the Jennings and Bedfords.
But a few dealings in stocks of non-Standard Oil companies of which they are directors are shown in the reports for David and Laurance Rockefeller, suggesting that they still command ample resources. Whether they have sold out any Standard Oil holdings in order to participate in other companies the record does not show, but there is no reason to suppose they have. Apart from their foundation trusteeships the
Rockefeller brothers, with the exception of New York Governor Nelson A. Rockefeller, are currently all directors of Rockefeller Center, Inc. , and Rockefeller Brothers, Inc.
David Rockefeller is chairman of the Chase Manhattan Bank, second largest in the country, and is known to hold stock in companies in which he holds directorships. The SEC, November, 1962, showed that he held 8,950 shares of B. F. Goodrich stock through trusts. As of 1965 he was a director of Goodrich, Rockefeller Brothers, Inc. , Equitable Life Assurance Society; and chairman of Morningside Heights, Inc. , a real estate development.
Laurance S. Rockefeller is often described as a "venture capitalist" and, in addition to his foundation trusteeships, was in 1965 chairman of Rockefeller Brothers, Inc. , Cancel Bay Plantation, Inc. , Rockefeller Center, Inc. ; director of Filatures et Tissages Africains; chairman of Estate Good Hope and of the Dorado Beach Hotel Corporation. The SEC reports, September, 1961, show that he held 183,274 shares, more than 15 per cent, of the Marquardt Corporation ($8-3/4-$19-1/2 ) after selling 1,300 shares. In Itek Corporation he sold 425 shares as reported by SEC in July, 1965, retaining 152,080 shares ($41). His investment orientation is said to be toward growth enterprises.
Winthrop Rockefeller, a self-described investment manager, has established himself in Arkansas as an extensive operator in land and large-scale agricultural projects. He is a director of the Union National Bank of Little Rock. The most martial of the Rockefellers, he entered the army as a private in 1941 and emerged as a lieutenant colonel; he was with the 77th infantry in the invasion of Guam, Leyte and Okinawa and was decorated with the Bronze Star with oak leaf cluster and the Purple Heart.
If one were to base one's conclusions about the financial status of the Rockefellers from the SEC reports alone, there would be little to tell. A stranger to the scene, with only the SEC reports to go on, would never conclude the Rockefellers amounted to much financially. But we do know from court records that the extensive Standard Oil holdings of John D. I passed to his children, chiefly to John D. II, whose will in turn indicated that he had established trust funds for his six children and many grandchildren. We are thrown back in this case to the TNEC study for basic data.
The family could have divested itself of Standard Oil holdings but, if it had, the fact would have become known through SEC reports or other channels The Rockefellers do not actively associate themselves with the management of the Standard Oil enterprises, apparently allowing them to be run according to standard big-business practices; but the general opinion of investment specialists is that directly and indirectly they hold a decisive veto power over any policy or action of these companies. No conceivable financial syndicate in the world would undertake to challenge the unobtrusive Rockefeller dominance of Standard Oil Company (New Jersey), the largest oil company and the largest industrial enterprise by assets of any kind in the world.
My conclusion is that the relative financial position of the Rockefeller family is now the same as or better than it was at the time of the TNEC study. It may be surpassed a bit by the far more numerous Du Ponts; but no single Du Pont appears to be as wealthy as any one of the six oldest Rockefellers. The financial strength of the Du Ponts is spread unevenly among some 250 persons. So, while the collective net worth of the Du Ponts may or may not be somewhat greater than that of the Rockefellers, only the Mellons can compare with the latter individually.
The general strength of the Rockefellers and Mellons, net worth to one side, also appears notably great because it is more widely diversified in high priority enterprises-- especially banking. The Du Ponts seem more deeply entrenched in frontier technology, although neither the Standard Oil companies nor Gulf Oil should be overlooked as huge
science-oriented enterprises. They are more than producers and distributors of petroleum.
But the very vagueness of our recent specific data on the Rockefellers, their failure to trade in and out of their stocks, should in itself be taken as a sign that they preside over enterprises too vast to permit distraction into minor operations.
The Rosenwald Family
About 25 per cent of the stock of Sears, Roebuck and Company, largest merchandising enterprise in the world, is owned by the employees' pension fund. The TNEC report showed the Rosenwald family holding 12. 5 per cent Of the stock, worth now about $500 million. While the Rosenwalds do not engage. in many stock transactions in this company, there have been a few, enough to signal that they are still present. Whether their percentage holding is now greater or less than it was there is no way of determining through the SEC reports. In view of the vast expansion of the company since the war, one would surmise that they had simultaneously added, net, to their holdings The most recent Rosenwald holding was shown in the SEC report for October, 1964, when Edgar B. (Rosenwald) Stern, Jr. , was shown as owning 25,017 shares directly, 1,762 shares as community property and 312,844 shares through a trust fund. He is a director of the company and an occasional trader in the stock. The July 11, 1949, SEC report showed that Julius Rosenwald II held 7,248 shares after selling 750 shares. As neither of these are the major living Rosenwalds, who are Lessing and William, we may safely conclude that the family still maintains a large financial presence in the company, with the management of which they have always been actively associated.
Miscellaneous Large Holdings
Similar large holdings by family and investment groups in major companies can be set forth. In order to economize on space there will now be summarily reported, on the basis of the SEC reports, some concentrated large stockholdings in the largest companies of 1964, mostly of old-line families. The dates are of the SEC monthly reports. Prices are the 1965 range.
Some such holdings are, incompletely, as follows:
Armour ($35-1/4--$53-1/8)
Frederick Henry Prince Trust of 1932
Modestus R. Bauer
William Wood Prince
Shares Date
356,000 Sept. , 1965
136,400 March, 1965
63,625 Jan. , 1965
175,090 Jan. , 1965
180,264
4,7 20
64,075
252,256
323
42,472
108,486
84,87 8
240,5 77
113,432 Sept. , 1965
193,872
Reynolds Metals
David P. Reynolds
($33-5/8--$48)
Trusts
Minor daughters
Davreyn Corp.
R. S. Reynolds, Jr.
Trusts
As custodian
Rireyn Corp.
William G. Reynolds
Trusts
Wilreyn Corp.
Singer
Stephen C. Clark, Jr,
Trusts
($56--$83-1/)4
F. Ambrose Clark
Trusts
259,264 Jan. , 1964
650,110
51,325 Sept. , 1965
35,759
21,896
61,500 Aug. , 1965
123,900
51,563 May, 1965
123,900
143,694 Feb. , 1960
19,500
3,451,913 Dec. , 1963
632,900
9,400
865,752 Nov. , 1963
1,000 Aug. , 1965
876,000
371,800
4,500 Aug. , 1964
1,500
4,682,504
2,711,801 May, 1963
1,797,895 May, 1961
25,000
12,980 July, 1965
4,200
60,000
25,450 Aug. , 1964
2,000
53,592 July, 1960
8,000
1,313,520 July, 1965
36,885
169,7176
1,216
American Sugar
Frederick E. Ossorio
Ossorio family
As custodian
Inland Steel
L. B. Block
Trusts
Joseph L. Block
($41-3/8--$48)
Trusts
Phillip D. Block, Jr
Trusts
Alleghany ($8-3/4--$13-3/4)
Allan P. Kirby (Woolworth)
Holding company A
Holding company B
Scott Paper ($33-$40-1/8)
Thomas B. McCabe
Minnesota Mining & Mfg.
Ralph H. Dwan
Trust
Trust
John D. Ordway
Foundation
Ordway Trust
William L. McKnight
Archibald G. Bush
($540-$71-5/8)
General Guarantee Insurance
Owens-Illinois ($49-5/8--67-1/4)
Robert H. Levis II
R. G. Levis Estate
Trust
J. Preston Levis
Trust
William E. Levis
Partnership
Polaroid
Edwin H. Land
James P.
Warburg
($44-1/4--$130)
Holding company
Bydale Company
Fontenoy Corporation
(Both of these holdings are
reduced from originals)
($19-3/8--$31-5/8)
International Business Machines ($404-$549)
Arthur K. Watson 56,111 May, 1965
Trusts 34,315
Thomas J. Watson, Jr. 37,072
Trusts 34,315
Sherman M. Fairchild 164,795
Magellan Company 3,750
Dow Chemical
Herbert H. Dow
Corning Glass Works
Amory Houghton
Trusts
Amory Houghton, Jr
Trusts
As Trustee
Arthur A. Houghton, Jr.
Trusts
International Paper
Ogden Phipps
Trust
Holding company
W. R. Grace
J. Peter Grace
Trusts
Michael Phipps
Holding company No. 1
Holding company No. 2
John H. Phipps
272,832
51,350
918,651
400
22,500
1,130
265,465
990,401
1,513
14,599
909,226
240,678
50,715
8,641
370,897
9,146
10,028
752
372,590
117,069
165,963
1,422
15,658
7,050
170,732
13,500
2,125
298,278
76,356
162,800
110,257
142,646
64,000
35,360
2,714,897
55,326
129,838
111,652
31,103
($24-3/4--$33-7/8)
236,921
Trust
Holding companies
Weyerhaeuser
C. D. Weyerhaeuser
Trust
Corporation
John H. Hauberg
($41-1/2--$49-3/8)
As guardian
Trusts
Corporations
Nonprofit corporation
Herbert M. Kieckbefer
John M. Musser
Trusts
As trustee
F. K. Weyerhaeuser
Trusts for children
Green Valley Co.
Winn-Dixie Stores ($35-1/8--$43-7/8)
Four members of Davis family
Anderson, Clayton ($26-1/8--$33-1/2)
S. M. McAshan, Jr.
S. C. McAshan Trust
William L. Clayton
Leland Anderson
Hunt Foods & Industries
Donald E. Simon
Trusts for children
Frederick R. Weisman
Lerand
Robert Ellis Simon
Georgia-Pacific
3,422
11,025
80,293
260,649
($65-1/8--$ 83-3/4)
($49-1/8--$58-3/4)
March, 1965
Feb. , 1963
Oct. , 1961
March, 1965
March, 1965
Dec. , 1963
July, 1962
Feb. , 1965
Dec. , 1964
April, 1964
Jan. , 1964
Feb. , 1965
Jan. , 1965
Oct. , 1964
Dec. , 1962
Jan. , 1965
Nov. , 1964
Aug. , 1964
($281/4--$36-1/8)
($47-1/4--$61-3/8)
($51-5/8--$65-5/8)
Julian N. Cheatham
J. N. Cheatham Corp.
Owen R. Cheatham
R. B. Pamplin
R. B. Pamplin Corp.
Trusts
Robert E. Floweree, Jr.
H. J. Heinz ($33-5/8--$49-3/8)
H. J. Heinz II
C. Z. Heinz Trust
Distillers Corporation--Seagrams
S. Bronfman Trusts
61,086
21,173
217,189
22,329
22,943
31,300
37,644
405,839
577,728
Dec. , 1964
March, 1965
Sept. , 1963
Aug. , 1963
Jan. , 1965
Dec. , 1964
Nov. , 1964
April, 1947
June, 1964
April, 1964
Jan. , 1964
April, 1964
April, 1964
March, 1964
Feb. , 1964
Rohm & Haas
F. Otto Haas
Trustee
John C. Haas
($151-1/2--$181-1/2)
13,936
23,707
20,446
23,708
638,702
644,767
As trustee
Trusts
Charitable trusts
(Also see Feb. , 1963, for
larger holdings)
William Wrigley, Jr.
Philip K. Wrigley
Trusts
Corporation
Firestone Tire & Rubber
Roger S. Firestone
H. S. Firestone, Jr.
Raymond C. Firestone
Roger S. Firestone
($92-1/4--$104-3/4)
364,256
Upjohn
Dorothy U. Dalton
Rudolph A. Light
Trusts
Preston S. Parish
Trusts
E. Gifford Upjohn
Trusts
Donald S. Gilmore
Trusts
Consolidation Coal
M. A. Hanna Co.
National Steel
M. A. Hanna Co.
Columbia Broadcasting
William S. Paley
Holding company
As trustee
Olin Mathieson Chemical
Spencer T. Olin
In voting trust
($30-3/8--$39-1/8)
3,382,026
60,845
15,000
($40-7/8--$50-1/4)
SPLIT 6 FOR 1
SPLIT 6 FOR 1
SPLIT 6 FOR 1
267,452
27,346
35,914
28,390
465,299
247,587
72,331
16,083
242,152
44,617
50,649
188,750
211,065
2,010,000
3,402, 780
1,391,968
297,430
9,178
28,984
380,930
($52-1/4--$77)
($46-3/8--$66-3/8)
($51--$65-3/4)
($33-5/8--$47-7/8)
($41--$58-1/4)
Ralston Purina
Donald Danforth, Jr.
As custodian
Crown-Zellerbach
J. D. Zellerbach
$34-7/8--$41-1/2)
Partnership
Foundation
Trusts
Brown Engineering
John F. Lynch
Fairchild Camera ($27-1/4-$165-1/4)
Sherman M. Fairchild
Partnership
Holding Company
Smith Kline & French Laboratories
Miles Valentine
0
747,066
16,850
16,528
19,232
249,566
457,396
35,000
22,000
Trust A
Trust B
Allied Chemical
William A. Burden
Trust
Company
($70-1/4--$86-3/4)
856
42,570
2,116,000
94,485
80,661
136,135
($47--$60-1/4)
40,304
61,346
104,462
Jan. , 1964
July, 1963
June, 1963
Jan. , 1963
Feb. , 1963
Dec. , 1962
Sept. , 1962
Sept. , 1961
Sept. , 1961
Aug. , 1961
Texas Eastern Transmission ($44-1/2--$53-3/4)
George R. Brown (Brown & Root)
($46-1/8--$58-1/4)
Merck
Adolph G. Rosengarten, Jr. SPLIT 3 FOR 1 33,110
Estate A
Estate B
Sehenley Industries
Lewis S. Rosenstiel
SPLIT 3 FOR 1
SPLIT 3 FOR 1
($22-1/4-$39-7/8)
60,600
43,000
636,958
66,183
1,500
217,859
510,558
Wholly owned company
Trust A
Trust B
American Metal Climax
Harold Hochschild
($40-3/4--$54-1/4)
($48-1/2--$75)
Concentrated Control in All Companies
Having shown the persistence into the present of these very large interests, it will now be demonstrated that virtually all companies--large, medium and small--are ultimately controlled and/or mainly owned by a few large interests manifested mainly as families.
One could show this by direct citation of the SEC reports, which would necessitate literally thousands of references. But these SEC reports are utilized by investment analysis services in reporting to their pecuniary-minded readers. These services summarize the SEC reports of large holdings. We may therefore refer to a highly reliable secondary source which picks lip and summarizes these facts, a source available in major public and university libraries. It is The Value Line Investment Survey, published by Arnold Bernard and Company of New York. This Survey, devoted to analyzing investment properties, keeps a large number of well-known listed companies under a thirteen-week cyclical survey each year. The facts about to be listed were taken
from the summaries of this Survey, which were compiled from the SEC monthly Official Summary.
The contention to which we are addressing ourselves, once again, is this: American companies are widely owned by at least twenty million stockholders, a number that is increasing. While this is true, because anyone owning a single share of stock worth $5 is a stockholder, we have already seen that most people do not own any stock at all. The thesis that stock ownership is widespread and the further thesis that most stock owners hold a great deal of stock is false. Only a very few people own stock in significant quantities. Just how few is shown by the cited University of Michigan studies.
In certain companies, it is true, stock ownership is widespread compared with most companies, and much of the stock is held in small quantities. But the fact that a person holds a small quantity of stock in a company like AT&T--100 to 500 shares--does not prove he is a small stockholder. He may and often does hold stock in many companies.
Although a company like AT&T does indeed have many small stockholders--persons owning 50 to 100 shares and perhaps little or no other stock--the carefully nurtured propaganda even about AT&T is grossly misleading. This propaganda asserts that no individual owns as much as 1 per cent of the stock of AT&T.
Now, if any person owned only 1/2 of 1 per cent of the stock in AT&T he would be enormously wealthy, worth about $160 million, but AT&T has large stockholders whose exact percentage of holdings today would be disclosed only by a government investigation addressing itself to this question. The United Kingdom government, for example, was until recently a very large stockholder in AT&T as well as in other American and European companies. European governments are large stockholders in many American and European companies. Additionally, private investment holding companies and family trust funds are large holders. The stockholdings interest even in AT&T, then, is not so completely generalized as one might conclude upon being informed that no individual owns as much as 1 per cent of its stock.
But if only ten individuals held 1/2 of 1 per cent each, that would be 5 per cent of the stock, worth about $1. 6 billion, and a long step toward working control.
In presenting the following list of dominant interests in a wide variety of companies it should be noticed that the big stockholders are usually characterized as a family or group of officers and directors. This is done to save space; anyone can look up officers and directors in standard reference manuals if he is interested in identities. Scores of companies reported in The Value Line Investment Survey are not listed. In general, those are not listed in which no large interest is reported.
But just because large interests do not trade in a stock and because directors own only a few shares there is no reason to believe that large interests are not in the immediate background. In the General Electric Company, world's largest manufacturer of electrical appliances, directors own only 1 per cent of the stock and the SEC reports do not show any single stockholder or family group holding more than 10 per cent of the stock. Nevertheless, stockholdings in General Electric are quite concentrated.
The TNEC study, for example, as of November 24, 1939, showed that 86. 2 per cent of the stockholders, owning 19. 4 per cent of the stock, held fewer than 100 shares each. But 13. 8 per cent of the stockholders, owning 80. 6 per cent of the stock, held in blocks of more than 100 shares each. 3
Actually, out of 209,732 stockholders at the time, 522, or . 2 per cent of all stockholders, held 33 per cent of outstanding General Electric stock, while 1. 5 per cent of all stockholders held 53 per cent of the stock. 4 At that time in E. I. du Pont de Nemours, known by current SEC data to be still closely held by the du Pont family, 0. 4
per cent of stockholders held 65. 7 per cent of all stock. 5 There is not much difference, then, between a company closely owned and one supposed to be widely owned.
At that same prewar period the TNEC study showed that in AT&T, 0. 02 per cent of stockholders held 7. 8 per cent of the stock, 0. 1 per cent of the stockholders held 15. 3 per cent of stock and 0. 4 per cent of the stockholders held 21. 2 per cent of the stock (these figures being cumulative). 6
In a large company only 5 per cent of the stock, particularly if it is voted by the management, is generally considered to be a long step toward working control, and 15 per cent is said to be well-grounded working control. Only a powerful syndicate contending for the support of medium and small stockholders can hope to challenge the control of a 15-per-cent block in a big company. Naturally, the closer the controlling block approaches 51 per cent of the stock the nearer it is to absolute control. But working control is ordinarily sufficient for running the company and determining its policies.
AT&T in 1965 had 2,674,000 stockholders. If we assume there is now the same distribution of large stockholders its before World War II, then 534 stockholders now vote 7. 8 per cent of the stock, 2,674 vote 15. 3 per cent and 10,679 vote 21. 2 per cent of the stock. Thus is refuted the contention that in this most widely owned of American companies there is no power-center of concentrated ownership. And if these percentages do not now actually prevail, some closely similar set of percentages surely holds and it may well be that relatively fewer stock-holders own larger percentages of the stock now than in 1939.
The management of AT&T, far from representing a generalized wide interest in its stock, in fact acts at the behest of a small group of large stockholders and trust fund managers. The directors themselves hold less than 0. 1 per cent of the stock.
By consulting this same TNEC source anyone can ascertain that in every large American company, no matter bow many individual stockholders it may have, extremely large blocks are held by a handful of people. Indeed, the same statistical presentation of TNEC showed some large companies to be 100 per cent owned by a single shareholding: Great Atlantic and Pacific Tea Company, Ford Motor Company and Hearst Consolidated Publications. In the 1930's it was quite common for big public utility operating companies to be 100 per cent owned by a holding company and for entire issues of preferred stock to be owned by a single stockholder.
The TNEC study showed, in fact, that almost always only a fraction of 1 per cent of the stockholders (usually only a small fraction) in all the large companies own huge controlling blocks of stock. 7 Numerous small stockholders collectively usually own only a minor percentage of outstanding stock.
Let me here cite the TNEC percentages for a few companies commonly regarded as widely held. American Can, . 2 per cent of stockholders owned 29. 9 per cent, . 8 per cent owned 45. 2 per cent; Coca-Cola, . 7 per cent owned 66. 1 per cent; Corn Products, . 4 per cent owned 37. 3 per cent; Consolidated Edison, . 2 per cent owned 30. 8 per cent; Eastman Kodak, . 1 per cent owned 16 per cent; General Motors, . 6 per cent owned 65. 5 per cent; Sears, Roebuck, . 2 per cent owned 44. 9 per cent; Texas Corporation, .
The SEC reports do not show holdings for Du Ponts in other companies where they are not officers, do not own more than 10 per cent individually, or have not engaged in stock transactions. But that they are interested personally in other companies is shown by the September, 1965, Official Summary where Henry B. du Pont is reported holding 6,000 shares in Remington Arms after selling 500 shares. E. I. du Pont de Nemours owns 60 per cent of Remington common and 99. 6 per cent of the preferred. Transactions were not traced for this study in companies like U. S. Rubber and Phillips Petroleum, where Du Pont interests are represented on the boards of directors.
But in Remington Arms another big old-line family holding was shown in the December, 1961, report for M. Hartley Dodge, son of the founder, who was reported as retaining 510,787 shares after selling 9,072 shares to other members of his family. Mr. Dodge, son-in-law of William Rockefeller, held 50,000 additional Remington Arms shares through a holding company and 28,407 shares in a trust fund. (The SEC reports provide similar information on the other old-line wealthy families: Phipps, Clark, Danforth, Knudsen, Baker, Anderson-Clayton, Dollar, Fisher, Heinz, Swift, Prince, Pew, Harriman, Block, Ryerson, Pitcairn, Hanna, Levis, Warburg, Kresge, Timken, Armour, Grace, Bedford, Firestone, Rosenwald, Colgate, Peet, Milbank, Crocker, Jennings, Olmsted, Cudahy, Havemever, Cabot, Lehman, Woolworth, Gimbel, Jones- Laughlin, Candler, Rosengarten, Hochschild, Wrigley, Rosenstiel, Reynolds, and others. )
With very few exceptions, and a few additions, the roll that was called in the formidable TNEC study is echoed and reechoed today in the SEC monthly reports.
What has been proved in these foregoing pages? Not very much, one would be forced to agree: Merely that the Du Ponts are still alive and thriving and are richer and more powerful today than they were in 1940. And one can predict that they will continue to grow richer and more powerful as long as the continually amended New Deal, Square Deal, New Frontier and Great Society politico-economic synthesis prevails.
The Ford Family
There isn't much doubt about the financial endurance of the Ford family, because the holdings of Henry and Edsel Ford were transferred only after 1947 to the present heirs. Those who believe they may be suffering extinction under the impact of metaphorically brutal taxes or other forces may gain reassurance from recent records.
The Fords did not turn up in the SEC reports until September, 1956, when it was shown that Benson Ford held 1,025,915 shares of Ford Motor Class B stock and Henry Ford II held 1,055,346 of the Class B. The Class B stock, all of which went to the Fords, holds 40 per cent of the voting power. The way this Class B holding came to the SEC record was explained as follows: "Reported that by the terms of a trust created by a relative, Benson Ford and Henry Ford II had in common with two others an option expiring 6/26/56 to acquire 15000 shares of Class B stock. Benson Ford, on 6/20/56, by gift, delivered an assignment of his portion (3750 shares) of the option. On 6/26/56 Henry Ford II, for a consideration, delivered an assignment of his portion (3750 shares) of the option. "
In the February, 1957, Official Summary it was reported that Henry Ford II disposed of 9,000 shares of Class B and in September, 1957, it was shown that he disposed of 100,000 shares and acquired 100,000 shares of the common. The March, 1959, report showed him disposing of 19,415 Class B shares in a private sale and that he had established a holding company that owned 3,284 shares; he retained 815,901 Class B shares at this point. By September, 1959, he had reduced his common holdings to 90,500 shares.
As of September, 1964, Henry Ford II no longer held any common in his own name but did hold 43,846 shares through a trust.
In March, 1964, it was reported that he now owned 1,319,576 Class B shares, held 75,000 B shares in trust, 12,000 B shares through holding companies and was trustee for 316,398 B shares. He now held 99,846 common -shares in a trust.
In January, 1962, it was reported that Benson Ford had reduced his direct holdings of the Class B to 894,147 shares but indirectly held 5,987 in holding companies and 105,456 in trust.
These are the latest positions through 1965 shown for the two men. No positions are shown for William or Charlotte Ford, which presumably were originally identical.
As reported earlier in this account, the Ford family effectively controls the Ford Motor Company and would continue to control it even if a considerable amount of additional common stock were given voting power through sale by the Ford Foundation.
The Mellon Family
The SEC report of March, 1965, showed Richard King Mellon clearing out his last 100 shares of Aluminum Company of America $3. 75 cumulative preferred stock, leaving his holdings in this issue at zero. In July, 1963, however, he was shown as holding 861,200 common shares of Alcoa ($61-1/2-$79-5/8) ) after disposing of 291,552 shares. Alcoa is the world's largest aluminum producer. And in June, 1963, he retained 2,809,922 shares of Gulf Oil ($87-$94-1/4) ) after disposing of 1,943,580. But in July, 1961, he held 4,666,929 shares of Gulf after selling 400,000 shares.
On the basis of the above facts one might reasonably conclude that the Mellons were still flourishing, without taking into account their other manifestations in the form of directorships and the like.
But a more positive showing can be made. In December, 1945, according to SEC reports, some years before six-for-one stock splits, Richard King Mellon owned 1,070,637 shares of Gulf Oil, and his sister, Sarah Mellon Scaife (who died late in 1965) owned 1,041,144 shares. Donaldson Brown of General Motors and Du Pont intermarriage owned 100 shares of Gulf Oil in July, 1947, and held 93,400 through the Broseco Corporation. Alan M. Scaife owned 9,300 shares of Gulf Oil, according to the January 10, 1949, SEC report, and by January, 1950, had raised his holding to 10,300 shares. He owned 30,600 shares in June, 1951.
Down through the years various other transactions in Gulf Oil and Alcoa are shown for this branch of the Mellon family but there is no present point in tracing them; the Mellons are, obviously, still in the ascendant.
The SEC reports show no transactions since 1945 in Gulf Oil or Alcoa for Paul or Ailsa Mellon or transactions for either of these two Mellons in the securities of any companies since 1960. Paul Mellon has been less active than his older cousin in corporate affairs, has more particularly applied himself to foundation and cultural affairs.
The TNEC study found that this clan had a finger in some hundred companies. Even if one had records of recent transactions in them all it would be awkward to set them forth. Exposition is defeated by the very extent of holdings. Recent SEC reports show, for example, that the Consolidation Coal Company, formerly the Pittsburgh Coal Company, of which Richard, Paul, Sarah and Ailsa Mellon owned more than 50 per cent (according to the TNEC study), now holds a 7 per cent interest in the Chrysler Corporation. To trace all such ramifications would be a virtually endless task.
Nor can we undertake to scrutinize all overlappings of large interests. The M. A. Hanna Company is a very large stockholder in Consolidation Coal, the SEC reports, and has heavy investments in many other large companies. H. Barksdale Brown, of the Du Pont clan, owns 3,317 shares of Gulf Oil (SEC, May, 1965); and the Broseco Corporation, instrument of the Brown family, held 666,684 shares on that date. We have already seen that Donaldson Brown, former high General Motors executive, and the Broseco Corporation are heavy stockholders in E. I. du Pont de Nemours. Donaldson Brown and the Broseco Corporation are also substantial stockholders in General Motors (SEC, October, 1950). Down through the years there has been much talk, much of it uninformed, about interlocking directorships. It is more significant that there is a great deal of interlocking ownership among the big interests.
The Pew Family
The TNEC study found the Pew family of Philadelphia in firm ownershipcontrol of the huge Sun Oil Company ($56-5/8-$67-3/4). Recent SEC reports confirm that the family is still in charge with a large dominant interest, 41. 5 per cent. John G. Pew recently held 44,139 shares (September, 1965). Arthur E. Pew, Jr. , held 37,170 shares and a John G. Pew trust 217 shares (December, 1964). Walter C. Pew held 434,214 shares (November, 1964). J. Howard Pew held 794,416 shares (April, 1964). A trust for A. E. Pew, Jr. , held 32,207 shares (November, 1963). J. N. Pew, Jr. , held 647,335 shares (November, 1960). And so on. Whatever the precise Pew ownership position is at any given time, one is obliged to conclude that the Pews are still in full charge of the Sun Oil Company.
The Pitcairn Family
This Pennsylvania family, shown by the TNEC study to dominate the giant Pittsburgh Plate Glass Company ($67-1/4-$85), in the SEC report for August, 1965, was shown to still hold 3,121,296 shares (about 30 per cent) through the Pitcairn Company, the family holding company. Nathan Pitcairn, according to SEC reports (August, 1963) owned 2,912 shares of the Pittston Company ($23-1/8-$32-3/8), big coal, oil and transportation holding company; and the Pitcairn Company held 42,000 shares of Pittston, Whatever else they own the available record showeth not.
The Rockefeller Family
The SEC reports fail to show any dealings in any of the Standard Oil Company stocks by the six leading Rockefellers since 1940. This lacuna is perhaps to be expected, as none of them is a director in the Standard Oil cluster and apparently none individually owns as much as 10 per cent of any Standard Oil stock. As far as the SEC reports show, the Rockefeller position in the Standard Oil group has remained basically unchanged since the time of the TNEC study, although there could have been sales or purchases without their being reflected in the SEC reports. There were indeed sales of Socony in the early 1950's by the late John D. Rockefeller, Jr.
The SEC report for July 10, 1947, showed the Rockefeller Foundation holding 345,902 shares of Standard Oil of Ohio after selling 6,782 shares. Various SEC reports show recent holdings for old-line Standard Oil families such as the Jennings and Bedfords.
But a few dealings in stocks of non-Standard Oil companies of which they are directors are shown in the reports for David and Laurance Rockefeller, suggesting that they still command ample resources. Whether they have sold out any Standard Oil holdings in order to participate in other companies the record does not show, but there is no reason to suppose they have. Apart from their foundation trusteeships the
Rockefeller brothers, with the exception of New York Governor Nelson A. Rockefeller, are currently all directors of Rockefeller Center, Inc. , and Rockefeller Brothers, Inc.
David Rockefeller is chairman of the Chase Manhattan Bank, second largest in the country, and is known to hold stock in companies in which he holds directorships. The SEC, November, 1962, showed that he held 8,950 shares of B. F. Goodrich stock through trusts. As of 1965 he was a director of Goodrich, Rockefeller Brothers, Inc. , Equitable Life Assurance Society; and chairman of Morningside Heights, Inc. , a real estate development.
Laurance S. Rockefeller is often described as a "venture capitalist" and, in addition to his foundation trusteeships, was in 1965 chairman of Rockefeller Brothers, Inc. , Cancel Bay Plantation, Inc. , Rockefeller Center, Inc. ; director of Filatures et Tissages Africains; chairman of Estate Good Hope and of the Dorado Beach Hotel Corporation. The SEC reports, September, 1961, show that he held 183,274 shares, more than 15 per cent, of the Marquardt Corporation ($8-3/4-$19-1/2 ) after selling 1,300 shares. In Itek Corporation he sold 425 shares as reported by SEC in July, 1965, retaining 152,080 shares ($41). His investment orientation is said to be toward growth enterprises.
Winthrop Rockefeller, a self-described investment manager, has established himself in Arkansas as an extensive operator in land and large-scale agricultural projects. He is a director of the Union National Bank of Little Rock. The most martial of the Rockefellers, he entered the army as a private in 1941 and emerged as a lieutenant colonel; he was with the 77th infantry in the invasion of Guam, Leyte and Okinawa and was decorated with the Bronze Star with oak leaf cluster and the Purple Heart.
If one were to base one's conclusions about the financial status of the Rockefellers from the SEC reports alone, there would be little to tell. A stranger to the scene, with only the SEC reports to go on, would never conclude the Rockefellers amounted to much financially. But we do know from court records that the extensive Standard Oil holdings of John D. I passed to his children, chiefly to John D. II, whose will in turn indicated that he had established trust funds for his six children and many grandchildren. We are thrown back in this case to the TNEC study for basic data.
The family could have divested itself of Standard Oil holdings but, if it had, the fact would have become known through SEC reports or other channels The Rockefellers do not actively associate themselves with the management of the Standard Oil enterprises, apparently allowing them to be run according to standard big-business practices; but the general opinion of investment specialists is that directly and indirectly they hold a decisive veto power over any policy or action of these companies. No conceivable financial syndicate in the world would undertake to challenge the unobtrusive Rockefeller dominance of Standard Oil Company (New Jersey), the largest oil company and the largest industrial enterprise by assets of any kind in the world.
My conclusion is that the relative financial position of the Rockefeller family is now the same as or better than it was at the time of the TNEC study. It may be surpassed a bit by the far more numerous Du Ponts; but no single Du Pont appears to be as wealthy as any one of the six oldest Rockefellers. The financial strength of the Du Ponts is spread unevenly among some 250 persons. So, while the collective net worth of the Du Ponts may or may not be somewhat greater than that of the Rockefellers, only the Mellons can compare with the latter individually.
The general strength of the Rockefellers and Mellons, net worth to one side, also appears notably great because it is more widely diversified in high priority enterprises-- especially banking. The Du Ponts seem more deeply entrenched in frontier technology, although neither the Standard Oil companies nor Gulf Oil should be overlooked as huge
science-oriented enterprises. They are more than producers and distributors of petroleum.
But the very vagueness of our recent specific data on the Rockefellers, their failure to trade in and out of their stocks, should in itself be taken as a sign that they preside over enterprises too vast to permit distraction into minor operations.
The Rosenwald Family
About 25 per cent of the stock of Sears, Roebuck and Company, largest merchandising enterprise in the world, is owned by the employees' pension fund. The TNEC report showed the Rosenwald family holding 12. 5 per cent Of the stock, worth now about $500 million. While the Rosenwalds do not engage. in many stock transactions in this company, there have been a few, enough to signal that they are still present. Whether their percentage holding is now greater or less than it was there is no way of determining through the SEC reports. In view of the vast expansion of the company since the war, one would surmise that they had simultaneously added, net, to their holdings The most recent Rosenwald holding was shown in the SEC report for October, 1964, when Edgar B. (Rosenwald) Stern, Jr. , was shown as owning 25,017 shares directly, 1,762 shares as community property and 312,844 shares through a trust fund. He is a director of the company and an occasional trader in the stock. The July 11, 1949, SEC report showed that Julius Rosenwald II held 7,248 shares after selling 750 shares. As neither of these are the major living Rosenwalds, who are Lessing and William, we may safely conclude that the family still maintains a large financial presence in the company, with the management of which they have always been actively associated.
Miscellaneous Large Holdings
Similar large holdings by family and investment groups in major companies can be set forth. In order to economize on space there will now be summarily reported, on the basis of the SEC reports, some concentrated large stockholdings in the largest companies of 1964, mostly of old-line families. The dates are of the SEC monthly reports. Prices are the 1965 range.
Some such holdings are, incompletely, as follows:
Armour ($35-1/4--$53-1/8)
Frederick Henry Prince Trust of 1932
Modestus R. Bauer
William Wood Prince
Shares Date
356,000 Sept. , 1965
136,400 March, 1965
63,625 Jan. , 1965
175,090 Jan. , 1965
180,264
4,7 20
64,075
252,256
323
42,472
108,486
84,87 8
240,5 77
113,432 Sept. , 1965
193,872
Reynolds Metals
David P. Reynolds
($33-5/8--$48)
Trusts
Minor daughters
Davreyn Corp.
R. S. Reynolds, Jr.
Trusts
As custodian
Rireyn Corp.
William G. Reynolds
Trusts
Wilreyn Corp.
Singer
Stephen C. Clark, Jr,
Trusts
($56--$83-1/)4
F. Ambrose Clark
Trusts
259,264 Jan. , 1964
650,110
51,325 Sept. , 1965
35,759
21,896
61,500 Aug. , 1965
123,900
51,563 May, 1965
123,900
143,694 Feb. , 1960
19,500
3,451,913 Dec. , 1963
632,900
9,400
865,752 Nov. , 1963
1,000 Aug. , 1965
876,000
371,800
4,500 Aug. , 1964
1,500
4,682,504
2,711,801 May, 1963
1,797,895 May, 1961
25,000
12,980 July, 1965
4,200
60,000
25,450 Aug. , 1964
2,000
53,592 July, 1960
8,000
1,313,520 July, 1965
36,885
169,7176
1,216
American Sugar
Frederick E. Ossorio
Ossorio family
As custodian
Inland Steel
L. B. Block
Trusts
Joseph L. Block
($41-3/8--$48)
Trusts
Phillip D. Block, Jr
Trusts
Alleghany ($8-3/4--$13-3/4)
Allan P. Kirby (Woolworth)
Holding company A
Holding company B
Scott Paper ($33-$40-1/8)
Thomas B. McCabe
Minnesota Mining & Mfg.
Ralph H. Dwan
Trust
Trust
John D. Ordway
Foundation
Ordway Trust
William L. McKnight
Archibald G. Bush
($540-$71-5/8)
General Guarantee Insurance
Owens-Illinois ($49-5/8--67-1/4)
Robert H. Levis II
R. G. Levis Estate
Trust
J. Preston Levis
Trust
William E. Levis
Partnership
Polaroid
Edwin H. Land
James P.
Warburg
($44-1/4--$130)
Holding company
Bydale Company
Fontenoy Corporation
(Both of these holdings are
reduced from originals)
($19-3/8--$31-5/8)
International Business Machines ($404-$549)
Arthur K. Watson 56,111 May, 1965
Trusts 34,315
Thomas J. Watson, Jr. 37,072
Trusts 34,315
Sherman M. Fairchild 164,795
Magellan Company 3,750
Dow Chemical
Herbert H. Dow
Corning Glass Works
Amory Houghton
Trusts
Amory Houghton, Jr
Trusts
As Trustee
Arthur A. Houghton, Jr.
Trusts
International Paper
Ogden Phipps
Trust
Holding company
W. R. Grace
J. Peter Grace
Trusts
Michael Phipps
Holding company No. 1
Holding company No. 2
John H. Phipps
272,832
51,350
918,651
400
22,500
1,130
265,465
990,401
1,513
14,599
909,226
240,678
50,715
8,641
370,897
9,146
10,028
752
372,590
117,069
165,963
1,422
15,658
7,050
170,732
13,500
2,125
298,278
76,356
162,800
110,257
142,646
64,000
35,360
2,714,897
55,326
129,838
111,652
31,103
($24-3/4--$33-7/8)
236,921
Trust
Holding companies
Weyerhaeuser
C. D. Weyerhaeuser
Trust
Corporation
John H. Hauberg
($41-1/2--$49-3/8)
As guardian
Trusts
Corporations
Nonprofit corporation
Herbert M. Kieckbefer
John M. Musser
Trusts
As trustee
F. K. Weyerhaeuser
Trusts for children
Green Valley Co.
Winn-Dixie Stores ($35-1/8--$43-7/8)
Four members of Davis family
Anderson, Clayton ($26-1/8--$33-1/2)
S. M. McAshan, Jr.
S. C. McAshan Trust
William L. Clayton
Leland Anderson
Hunt Foods & Industries
Donald E. Simon
Trusts for children
Frederick R. Weisman
Lerand
Robert Ellis Simon
Georgia-Pacific
3,422
11,025
80,293
260,649
($65-1/8--$ 83-3/4)
($49-1/8--$58-3/4)
March, 1965
Feb. , 1963
Oct. , 1961
March, 1965
March, 1965
Dec. , 1963
July, 1962
Feb. , 1965
Dec. , 1964
April, 1964
Jan. , 1964
Feb. , 1965
Jan. , 1965
Oct. , 1964
Dec. , 1962
Jan. , 1965
Nov. , 1964
Aug. , 1964
($281/4--$36-1/8)
($47-1/4--$61-3/8)
($51-5/8--$65-5/8)
Julian N. Cheatham
J. N. Cheatham Corp.
Owen R. Cheatham
R. B. Pamplin
R. B. Pamplin Corp.
Trusts
Robert E. Floweree, Jr.
H. J. Heinz ($33-5/8--$49-3/8)
H. J. Heinz II
C. Z. Heinz Trust
Distillers Corporation--Seagrams
S. Bronfman Trusts
61,086
21,173
217,189
22,329
22,943
31,300
37,644
405,839
577,728
Dec. , 1964
March, 1965
Sept. , 1963
Aug. , 1963
Jan. , 1965
Dec. , 1964
Nov. , 1964
April, 1947
June, 1964
April, 1964
Jan. , 1964
April, 1964
April, 1964
March, 1964
Feb. , 1964
Rohm & Haas
F. Otto Haas
Trustee
John C. Haas
($151-1/2--$181-1/2)
13,936
23,707
20,446
23,708
638,702
644,767
As trustee
Trusts
Charitable trusts
(Also see Feb. , 1963, for
larger holdings)
William Wrigley, Jr.
Philip K. Wrigley
Trusts
Corporation
Firestone Tire & Rubber
Roger S. Firestone
H. S. Firestone, Jr.
Raymond C. Firestone
Roger S. Firestone
($92-1/4--$104-3/4)
364,256
Upjohn
Dorothy U. Dalton
Rudolph A. Light
Trusts
Preston S. Parish
Trusts
E. Gifford Upjohn
Trusts
Donald S. Gilmore
Trusts
Consolidation Coal
M. A. Hanna Co.
National Steel
M. A. Hanna Co.
Columbia Broadcasting
William S. Paley
Holding company
As trustee
Olin Mathieson Chemical
Spencer T. Olin
In voting trust
($30-3/8--$39-1/8)
3,382,026
60,845
15,000
($40-7/8--$50-1/4)
SPLIT 6 FOR 1
SPLIT 6 FOR 1
SPLIT 6 FOR 1
267,452
27,346
35,914
28,390
465,299
247,587
72,331
16,083
242,152
44,617
50,649
188,750
211,065
2,010,000
3,402, 780
1,391,968
297,430
9,178
28,984
380,930
($52-1/4--$77)
($46-3/8--$66-3/8)
($51--$65-3/4)
($33-5/8--$47-7/8)
($41--$58-1/4)
Ralston Purina
Donald Danforth, Jr.
As custodian
Crown-Zellerbach
J. D. Zellerbach
$34-7/8--$41-1/2)
Partnership
Foundation
Trusts
Brown Engineering
John F. Lynch
Fairchild Camera ($27-1/4-$165-1/4)
Sherman M. Fairchild
Partnership
Holding Company
Smith Kline & French Laboratories
Miles Valentine
0
747,066
16,850
16,528
19,232
249,566
457,396
35,000
22,000
Trust A
Trust B
Allied Chemical
William A. Burden
Trust
Company
($70-1/4--$86-3/4)
856
42,570
2,116,000
94,485
80,661
136,135
($47--$60-1/4)
40,304
61,346
104,462
Jan. , 1964
July, 1963
June, 1963
Jan. , 1963
Feb. , 1963
Dec. , 1962
Sept. , 1962
Sept. , 1961
Sept. , 1961
Aug. , 1961
Texas Eastern Transmission ($44-1/2--$53-3/4)
George R. Brown (Brown & Root)
($46-1/8--$58-1/4)
Merck
Adolph G. Rosengarten, Jr. SPLIT 3 FOR 1 33,110
Estate A
Estate B
Sehenley Industries
Lewis S. Rosenstiel
SPLIT 3 FOR 1
SPLIT 3 FOR 1
($22-1/4-$39-7/8)
60,600
43,000
636,958
66,183
1,500
217,859
510,558
Wholly owned company
Trust A
Trust B
American Metal Climax
Harold Hochschild
($40-3/4--$54-1/4)
($48-1/2--$75)
Concentrated Control in All Companies
Having shown the persistence into the present of these very large interests, it will now be demonstrated that virtually all companies--large, medium and small--are ultimately controlled and/or mainly owned by a few large interests manifested mainly as families.
One could show this by direct citation of the SEC reports, which would necessitate literally thousands of references. But these SEC reports are utilized by investment analysis services in reporting to their pecuniary-minded readers. These services summarize the SEC reports of large holdings. We may therefore refer to a highly reliable secondary source which picks lip and summarizes these facts, a source available in major public and university libraries. It is The Value Line Investment Survey, published by Arnold Bernard and Company of New York. This Survey, devoted to analyzing investment properties, keeps a large number of well-known listed companies under a thirteen-week cyclical survey each year. The facts about to be listed were taken
from the summaries of this Survey, which were compiled from the SEC monthly Official Summary.
The contention to which we are addressing ourselves, once again, is this: American companies are widely owned by at least twenty million stockholders, a number that is increasing. While this is true, because anyone owning a single share of stock worth $5 is a stockholder, we have already seen that most people do not own any stock at all. The thesis that stock ownership is widespread and the further thesis that most stock owners hold a great deal of stock is false. Only a very few people own stock in significant quantities. Just how few is shown by the cited University of Michigan studies.
In certain companies, it is true, stock ownership is widespread compared with most companies, and much of the stock is held in small quantities. But the fact that a person holds a small quantity of stock in a company like AT&T--100 to 500 shares--does not prove he is a small stockholder. He may and often does hold stock in many companies.
Although a company like AT&T does indeed have many small stockholders--persons owning 50 to 100 shares and perhaps little or no other stock--the carefully nurtured propaganda even about AT&T is grossly misleading. This propaganda asserts that no individual owns as much as 1 per cent of the stock of AT&T.
Now, if any person owned only 1/2 of 1 per cent of the stock in AT&T he would be enormously wealthy, worth about $160 million, but AT&T has large stockholders whose exact percentage of holdings today would be disclosed only by a government investigation addressing itself to this question. The United Kingdom government, for example, was until recently a very large stockholder in AT&T as well as in other American and European companies. European governments are large stockholders in many American and European companies. Additionally, private investment holding companies and family trust funds are large holders. The stockholdings interest even in AT&T, then, is not so completely generalized as one might conclude upon being informed that no individual owns as much as 1 per cent of its stock.
But if only ten individuals held 1/2 of 1 per cent each, that would be 5 per cent of the stock, worth about $1. 6 billion, and a long step toward working control.
In presenting the following list of dominant interests in a wide variety of companies it should be noticed that the big stockholders are usually characterized as a family or group of officers and directors. This is done to save space; anyone can look up officers and directors in standard reference manuals if he is interested in identities. Scores of companies reported in The Value Line Investment Survey are not listed. In general, those are not listed in which no large interest is reported.
But just because large interests do not trade in a stock and because directors own only a few shares there is no reason to believe that large interests are not in the immediate background. In the General Electric Company, world's largest manufacturer of electrical appliances, directors own only 1 per cent of the stock and the SEC reports do not show any single stockholder or family group holding more than 10 per cent of the stock. Nevertheless, stockholdings in General Electric are quite concentrated.
The TNEC study, for example, as of November 24, 1939, showed that 86. 2 per cent of the stockholders, owning 19. 4 per cent of the stock, held fewer than 100 shares each. But 13. 8 per cent of the stockholders, owning 80. 6 per cent of the stock, held in blocks of more than 100 shares each. 3
Actually, out of 209,732 stockholders at the time, 522, or . 2 per cent of all stockholders, held 33 per cent of outstanding General Electric stock, while 1. 5 per cent of all stockholders held 53 per cent of the stock. 4 At that time in E. I. du Pont de Nemours, known by current SEC data to be still closely held by the du Pont family, 0. 4
per cent of stockholders held 65. 7 per cent of all stock. 5 There is not much difference, then, between a company closely owned and one supposed to be widely owned.
At that same prewar period the TNEC study showed that in AT&T, 0. 02 per cent of stockholders held 7. 8 per cent of the stock, 0. 1 per cent of the stockholders held 15. 3 per cent of stock and 0. 4 per cent of the stockholders held 21. 2 per cent of the stock (these figures being cumulative). 6
In a large company only 5 per cent of the stock, particularly if it is voted by the management, is generally considered to be a long step toward working control, and 15 per cent is said to be well-grounded working control. Only a powerful syndicate contending for the support of medium and small stockholders can hope to challenge the control of a 15-per-cent block in a big company. Naturally, the closer the controlling block approaches 51 per cent of the stock the nearer it is to absolute control. But working control is ordinarily sufficient for running the company and determining its policies.
AT&T in 1965 had 2,674,000 stockholders. If we assume there is now the same distribution of large stockholders its before World War II, then 534 stockholders now vote 7. 8 per cent of the stock, 2,674 vote 15. 3 per cent and 10,679 vote 21. 2 per cent of the stock. Thus is refuted the contention that in this most widely owned of American companies there is no power-center of concentrated ownership. And if these percentages do not now actually prevail, some closely similar set of percentages surely holds and it may well be that relatively fewer stock-holders own larger percentages of the stock now than in 1939.
The management of AT&T, far from representing a generalized wide interest in its stock, in fact acts at the behest of a small group of large stockholders and trust fund managers. The directors themselves hold less than 0. 1 per cent of the stock.
By consulting this same TNEC source anyone can ascertain that in every large American company, no matter bow many individual stockholders it may have, extremely large blocks are held by a handful of people. Indeed, the same statistical presentation of TNEC showed some large companies to be 100 per cent owned by a single shareholding: Great Atlantic and Pacific Tea Company, Ford Motor Company and Hearst Consolidated Publications. In the 1930's it was quite common for big public utility operating companies to be 100 per cent owned by a holding company and for entire issues of preferred stock to be owned by a single stockholder.
The TNEC study showed, in fact, that almost always only a fraction of 1 per cent of the stockholders (usually only a small fraction) in all the large companies own huge controlling blocks of stock. 7 Numerous small stockholders collectively usually own only a minor percentage of outstanding stock.
Let me here cite the TNEC percentages for a few companies commonly regarded as widely held. American Can, . 2 per cent of stockholders owned 29. 9 per cent, . 8 per cent owned 45. 2 per cent; Coca-Cola, . 7 per cent owned 66. 1 per cent; Corn Products, . 4 per cent owned 37. 3 per cent; Consolidated Edison, . 2 per cent owned 30. 8 per cent; Eastman Kodak, . 1 per cent owned 16 per cent; General Motors, . 6 per cent owned 65. 5 per cent; Sears, Roebuck, . 2 per cent owned 44. 9 per cent; Texas Corporation, .
