BIG OIL MERGER

Sun (Auckland), Volume IV, Issue 930, 25 March 1930, Page 10

BIG OIL MERGER

VACUUM AND STANDARD CAPITAL OF £IBO,OOO 000 Official information in respect to the merger between the Vacuum Oil Company and the Standard Oil Company of New York, which was announced in a cablegram a few weeks ago, is given in a circular to shareholders which* arrived in this week’s overseas mail. The capital from the merger was stated to be £.180,000,000. Both companies were former subsidiaries of the Standard Oil Company of New Jersey. The business of the two companies is complementary in character, according to the statement In general, the business of the New York Company in the United States is primarily in crude production, refining, and marketing of gasoline and kerosene, while the business of the Vacuum Company in the United States is primarily in the manufacture and marketing of lubricating specialties. The bulk of the business of the New York company is in the United States, while that of the Vacuum Company is principally in foreign countries. "In the United S taxes there hav-? been rapid changes in conditions in the petroleum business which make this merger useful and appropriate for both companies,” says tht statement. "The prevailing method of doing business in the oil industry has come to be for each company doing a general business in petroleum products to have its own crude supply, its own refining facilities, and to offer a full line of petroleum products through intensive local marketing facilities. The merger wi:l make available to the Vacuum products a very much wider distribution and sale, and it will also make available the large crude oil production of the subsidiaries of the New York Conipany.” It is estimated that the united company, iri addition to the specialis'd lubricating products of the Vacuum Company, will market about 9 per cent, of the petroleum products consumed in the United States. The contract makes provision for uniting the assets of the two compani 's under the name of General Petroleum Corporation. Two subsidiary corporawill be formed, to be known the Vacuum Oil Company, Inc., and the Standard Oil Company of New York, Inc., in order that the present businesses of the respective companies may be carried on as in the past, and under the present management. The directors of the respective com l panies have entered into a contract f*<r I the merger, which they have brought ;t o the attention of the Governmen:. The Government lias indicated that t proposes to institue an appropriate proceeding in equity to determine the questions involved.