General Electric

When the electric industry of the U. S. first got under way, the problem of financing its customers at once arose. The General Electric Co. consequently organized the Electric Bond & Share Co. as a subsidiary, to supervise electrical engineering construction projects and to obtain capital for them. In enterprises so financed, purchases of electrical equipment were confined to the General Electric as a seller. The Electric Bond & Share Co. came to control directly or indirectly over 100 electric power, street railway and gas companies, with a combined capital of about $650,000,000 and serving a population of over 7,000,000 people.

This union between General Electric as a seller and so many operating service companies as buyers, effected through the Electric Bond & Share Co., has long been criticized on the grounds of monopoly. While jealousy of rival producing companies and political claptrap have played a large part in such criticism, nevertheless there has been present something of truth and justification.

The General Electric officials, headed by Chairman Owen D. Young, have accordingly decided to take the bull by the horns and segregate Electric Bond & Share. This will be done by organizing a new company with 1,802,870 shares to take over the latter's business and receive General Electric's holdings in its subsidiary. To General Electric stockholders of record Jan. 15, 1925, the shares of this new company will be distributed as a stock dividend.

The action was taken entirely on the volition of the General Electric Co. Nevertheless, various political groups, particularly the Federal Trade Commission, will probably hasten to "claim credit'? for dissolving the "Electrical Trust."