One-Arm Battle

Two weeks ago a Colgate went back to Colgate-Palmolive-Peet. Last week a Thompson went back to 118 one-armed lunchrooms, but the process was some-what different. In 1927 John R. Thompson, self-made founder of the restaurant chain died leaving to his estate a lot of old masters (Hals, Raeburn, Corot, Diaz, Millet, Rousseau, Bellini) that had cost him some $750,000. To his company he left his Yale-educated Son (Class of 1918). John R. Jr. had been put through the business from the lunch counter up. Homely and negligent in dress, he was regarded by his father's good friends as too interested in horses and bridge to make a good executive.

A year ago he rose in arms, attempted to wrest control of the company from his father's associates (among the most potent businessmen in Chicago), who bought a large stock interest by amicable agreement, took seats on the board, ran the company after John R.'s death. Mr. McCulloch. longtime friend of the family, ironed out the difficulties; John R. Jr. said it was all a misunderstanding. He did not receive, however, the voice in the management that he had expected, and last December when Mr. McCulloch resigned as chairman he had William Collins (who had come into the company when John R. Thompson Co. absorbed Henrici's well-known Chicago restaurant) made president and chairman. Thompson Jr. was definitely out.

Thus began the battle for control. His father's friends said John R. Jr. was incompetent. He pointed out that the company had made $1,126,000 in 1930 but that beginning with 1931 earnings had fallen to $904,000, and in 1932 to $287.000 after allowing for a last quarter deficit of $95,000.

Backed by his mother, he and his wife motored around calling on stockholders, asking for proxies, writing letters. The opposition wrote letters in reply, said John R. Thompson Securities Corp. had formerly borrowed money improperly and sold unlisted securities to the restaurant company. Last week the proxies were counted. Two days were necessary to settle the conflicting claims. Final count was 135,568 shares for Thompson, 128,838 shares for the opposition. A new board of directors was chosen with Thompson directors holding five out of nine places. Sidney S. Gorham, prominent Chicago lawyer and Thompson ally, became chairman, and j jubilant John R. Jr. took control.

This file is automatically generated by a robot program, so reader's discretion is required.