United Gets Its Man

United Drug, Inc., after staring at subnormal profits statements for years, turned over a new leaf last week. It installed young Justin W. Dart, 34, as vice president and director and made him president of its Liggett Drug Co. subsidiary, largest U.S. chain of retail drugstores. Liggett has been one of United's vital assets but an unsatisfactory earner. Dart's job is to do something about it.

Despite his tender years, Dart is already an ex-Alger hero. Tall, blond, blue-eyed, handsome, he played football at Northwestern University, graduated in 1929, went to work as a stockroom clerk in a Walgreen store in Chicago, married Ruth Walgreen, the founder's daughter, and rose to be general manager of Walgreen Co. By last year he had been divorced from the founder's daughter and quit his job.

In 1929, Walgreen earned $3,097,000 from its chain of 325 stores, while the new supercombine known as Drug, Inc., in which United Drug was a member, had $17,000,000 profits. United's outlets were the 568 directly owned stores of the Liggett chain, some 10,000 "Rexall" independents. The grandiose Drug, Inc. merger contained many a great manufacturing name --Vick Chemical, Sterling Products (Bayer's Aspirin, Phillips Milk of Magnesia, Fletcher's Castoria), Life Savers, Bristol-Myers (Sal Hepatica, Rubberset brushes, Ipana). But the vital retail end limped almost from the start. Long-term leases put Liggett into bankruptcy in March 1933. Thereupon the big manufacturers, long restless and dissatisfied, un-merged the combine and each went its own way. Enough United stock remained in manufacturing hands, however, to give them a finger in United affairs.

United Drug, going it alone, bought back the Liggett chain in the bankruptcy proceedings, but its profit situation remained sour. Last year United's total assets were almost exactly twice those of Walgreen; but Walgreen chalked up $3,300,000 income against $2,500,000 for United.

Long have United directors cast their eyes in envy at the sweet Walgreen profits. Once they proposed a merger, but Walgreen would have none of it. The latest corporate stirrings came when Life Saver's Edward John Noble, former Under Secretary of Commerce, began to work on a new idea. The idea: to put Walgreen's Justin Dart, then footloose, at the head of the Liggett chain. Noble & associates enlarged their United stockholdings, lined up their friends, put on some pressure. Quietly, and amid seeming satisfaction all around, young Mr. Dart last week stepped in to see what he could do.

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