Du Pont Dividend

The E. I. du Pont de Nemours & Co. recently declared a 40% common stock dividend on its 950,609 shares of common $100 par stock, thus increasing the issue to 1,330,852. Shortly before, the stockholders had voted to increase the authorized common stock issue from 1,000,000 to 1,500,000 shares, or from $100,000,000 to $150,000,000.

Behind the declaration of this $38,000,00 "melon" lies a story. According to the company's statement, the stock dividend serves to capitalize an increase in the company's surplus of about $36,000,000 arising from appreciation of the General Motors stock held by the company, from about $42 to $70 per share. Du Pont's holdings of General Motors common, first and last, amounts to about 1,340,000 shares, or a share of General Motors for every share of Du Pont outstanding after the new stock dividend.

The Du Pont holdings in General Motors developed from an interest in the company shown as early as 1915 by J. J. Reskob, Du Pont Vice President. When after the Armistice W. C. Durant, General Motors head, found himself unable to continue in control of the company, the Du Pont concern, under persuasion of Mr. Raskob, raised $50,000,000 on its own credit to take up Durant's stock in the concern. Since that time the value of the stock has more than doubled, and now the Du Pont stockholders are receiving very substantial dividends from Mr. Raskob's foresight.