Mack Trucks

Ever since the auto bus began to be developed as a serious competitor of railroad and traction companies, there has been a vivid interest in Wall Street in Mack Trucks, Inc. Earnings on the stock have been sensational, and prices for it have soared on the anticipation that soon a big "melon" would be split for the special benefit of the shareholders.

The Company, however, has needed money development too much for this. Last August the stockholders were permitted to subscribe to one new share for every five shares held, at $80 per share, thus increasing the outstanding common stock from 283,110 to 339,732 shares. Incidentally, at present prices every share purchased at $80 shows a profit of over $100.

Recently, the Company decided to own its service stations and thus be able to give service on its products during their entire life. A subsidiary called the Mack Trucks Realty Co. was therefore organized. It will be financed by a $3,000,000 serial 6% note issue. But, meanwhile, the parent Company needs additional capital for expansion. Accordingly, all stockholders of record July 20 will be given the privilege of subscribing to one new share of common for every five shares held, at $100 a share. With the stock already selling at $184 a share, this means that the new "rights" are worth $14 a share on each old share--a handsome return to shareholders. This financing will bring about $7,500,000 of fresh capital into the Company, and increase the outstanding common shares from 339,732 to 407,678.