|
In Philadelphia, a
special federal court last week decided who will be permitted to buy
Pullman's sleeping-car company. It's choice: a combine of 52
railroads which already use 96% of Pullman's 7000 cars. The price:
$75,000,000.
The court agreed with Pullman that the roads should be
picked from the four bidders* because they "are the
natural and obvious people to be in the sleeping car business."
To ward off danger of a new monopoly replacing the old, the court ruled
that: 1) there must be no interlocking directorates among the
roads and Pullman; 2) the Pullman service--and the individual
roads--must buy new sleeping cars by competitive bidding.
In its decision the court flatly rejected the recommendations
of the Antitrust Division of the Department of Justice. The
department had argued that the sale to the roads would set up a new
monopoly, strongly recommended selling to a group made up of Alleghany
Corp.'s Robert Young, Allan Kirby, and Cleveland's Otis & Co.
This group had promised to spend $500,000,000 to spruce up the
service. And Bob Young had talked of coast-to-coast service, with no
changes at Chicago. |
|
Despite the decision, Bob Young seemed determined to go into the sleeper
business. As a start he plans to appeal the decision to the U.S. Supreme
Court. Last week he also announced that he plans to buy 1,000
brand-new sleepers for his Chesapeake & Ohio railroad. C. &
O. now has only 436 passenger cars of all types, obviously has no need of
1,000 sleepers for itself. Best guess was that Bob Young plans a
sleeper service for roads not in the combine.
* The 52-road combine; the
Alleghany-Otis combine; Glore, Forgan & Co.; Standard Steel Spring Co. |
