Evening Star Newspaper, February 8, 1942, Page 5

J Tangier Riot Follows Explosion Believed Fafal to 25 Persons Arabs and Spaniards Join In Demonstrations Against British By the Associated Press. TANGIER, Spanish Morocco, Feb. 7—Rioting against British business concerns flared up here tonight 24 hours after 25 pers- ons were believed killed in a time-bomb explosion, again fo- cusing attention on the delicate alignments in North Africa. (The Rome radio, in a broad- cast heard in New York Satur- day night by C. B. S,, said “Tele- phonic and telegraphic com- munications between Tangier and Spain have been interrupted.”) Arabs and Spaniards joined in tonight's demonstration, during which the British post office was damaged and all windows in the Minzah Hotel were broken. There was a lull in the rioting after many | shops had been damaged. | Blast Follows Ship Sailing. The explosion last night occurred on a quay 15 minutes after a steamer | had departed for Gibraltar. The steamer left a little earlier than | scheduled. In addition to the 25| persons believed killed, 60 were in- | jured, including more than 20 | Britons. The Madrid press carried dis- | patches from Tangier saying last night’s explosion occured in a taxi carrying a British diplomatic bag. These reports said 11 persons were killed and 36 injured. The Spanish press said police | found a large quantity of British | propaganda leaflets on the ground | following the explosion. Spanish authorities immediately started an investigation to determine | the cause of the explosion, it was' added. Tangier is in the former inter-| national zone of Spanish Morocco | over which the Franco government | of Spain has declared Spanish au- | thority and protection. It would be important in any German move to bolster its strength in North Africa by sending troops through Spain to Morocco. Indication that something im- | portant may be brewing in this corner of the world was seen in the fact that the German news and | propaganda agency, Transocean, | gave great prominence to the Fri- | day night bombing and blamed it on the British. Saturday’s rioting may well have been connected with German con- templated moves in this region. | Germans Accuse British. | German propagandists imme- diately seized on the bombing inci- dent to charge that the boat serv- ice between Gibraltar and Tangier was being used by the British to smuggle anti-Spanish propaganda | leaflets and explosives to the Arabs of Spanish Morocco. Transocean charged from Madrid | that many pieces of diplomatic lug- gage shipped to Tangier were found | by Spanish police to contain ex- plosives. The German agency said it was even possible that a cabinet council would be called by Gen- eralissimo Franco to discuss the situation. | Meanwhile, N. B. C. picked up a short-wave broadcast from Algiers | reporting that a French freighter was destroyed Saturday morning by | explosion as it was unloading its | cargo at Algiers. The Vichy-con- | trolled station suggested that a | time bomb “no doubt” was con- | cealed in baggage trans-shipped from Gibraltar. ONLY THREE OF CREW SURVIVED—View of the American submarine S-26, which the Navy announced yesterday sank off Panama the night of January escort vessel. 24 after collision with a Navy All but three members ofithe crew went down wi the submarine. The three rescued were on the bridge at time of the collision and were thrown clear. Checked Second Day, - th —A. P. Wirephoto, “stock dividend” which would be contrary to the public utilities law. Mr. Hankin's suggestion was that if the stock were sold to the parent company for $3000,000, and if it could be sold for $15,000,000 on the | open market, then the W. R. & E. stood to gain the difference or $12,- 000,000 in the form of a stock divi- dend. On this point, opinion stated: “All of the common stock of Pepco is owned by the W. R. & E, and because of this ownership W.R. & E. common stock is quoted on the market at figures in excess of $580 bid and $680 asked. If Pepco were to sell its shares in the open market, the amount of capital obtainable would probably be in excess of $15,000,000. But it seeks to sell these shares to W. R. & E. for $3,000,000. In these circumstances, the question arises whether ¢he commission would be justified in waiving its competitive bidding rules applicable to the sale of securities by public utilities within the District. “There may be a reason for waiv- ing the competitive-bidding rule, because all of the common stock of Pepco is owned by W. R. & E., and. therefore, a transfer of 30,000 additional shares would result merely in the holding of the same proportionate interest in the assets and in a contribution by W. R. & E. of an additional $3,000,000 to Pepco. “But then the question also arises whether the sale of 30000 shares to W. R. & E. at $100 a share does not amount to a stock dividend to the extent of the value of the shares in excess of $100. contrary to paragraph 75 of the public utilitles law.” Mr. Hankin said this paragraph provides that no public utility shall declare any stock, bond or scrip dividend or divide the proceeds of the sale of any stock, bond or scrip ampng its stockholders, 15 Specific Questions. In deferring decision on the pe- tition by Pepco and W. R. & E. for the proposed stock sale the com- mission directed its staff to find answers to 15 specific questions in investigating the ownership and financial matters as to the power concern, These may be paraphrased as fol- lows: 1. Whether the power company needs additional capital? 2. What would be the best meth- ods of financing? 3. How would the proposed method of financing, or other methods, affect the company, the consumers and the investors? 4. Are there special circumstances Mr. Hankin's 1 midnight, January 27, by a sweep % V : ships. B SURVIVED FREIGHTER BLAST—Capt. Ragnar Schutz, skipper of the torpedoed freighter Amerikaland, is treated at Swedish Hospital here after he and 10 others were brought ashore. The attack took place 170 miles off S8andy Hook. On right is Dr. Bruno Beviving. —A. P. Wirephato. | remove any survivors. view of the La Follette Anti-Merger Act? 12. Did North American acquire legal title to the securities? 13.—Did North American lawfully | receive dividends and other pay- ments from W. R. & E. or other public utilities in the District? 14.—Did North American or asso- ciated companies or nominees trans- fer legal title to securities disposed of, and can North American transfer legal title in the future? and 15.—To what extent were the acts of North American performed with the knowledge or acquiescence of the District P. U. C., and what bear- ing does such knowledge or acqui- escence have on the legal relation- ships under consideration. Large Surplus Seen. ' In his opinion on the case, Mr. Hankin raised a question as to whether Pepco had accumulated a “large earned surplus.” He explained | first that the capitalization of Pepco | consists of three bond issues totaling | in 1935 W. R. & E. flled a regis- tration statement with the Securi- ties and Exchange Commission proposing issuance of 40 shares for each share of common stock held by North American, the proposed price being $20 a share, which, it was explained, would have means $800 a share for each share of North American-held W. R. & E. common. This proposal was said to have created so much opposi- tion by undisclosed parties that the W. R. & E. withdrew the ap- plication. Red Cross Seeks Funds for War ‘The District Red Cross is ap- pealing for $750,000 as its quota of the American Red Cross War Fund Campaign for $50,- 000,000 to provide relief for American war victims and to carry on rapidly expanding Red which would warrant the suspension POWGI’ ‘!ot the competitive-bidding rule? (Continued Pro rst Page.) | 9. If the competitive bidding rule TExoen g - | be waived would the sale (as pro- tions have been raised formally or | posed) constitute a stock dividend? informally as to whether this was| 6. If the competitive bidding rule in violation of the letter or the | iS DOt waived, at what price should spirit of the LaFollette anti-merger } law, which forbids corporations | “foreign” to the District to control any Washington public utility. The question of North American’s control of W. R. & E. was con- | sidered and debated by congres- | slonal committees in 1925, when | Congress approved legislation au- thorizing merger of Washington's street car companies, and again in 1933, when Congresg=passed a re- solution to effectuate the merger. | Pepco, always a big profit-maker, | was left out of the railway merger.} ‘except that the W. R. & E. Co. re- | mained as a local holding company, | having 51 per cent of the commoh | stock of the Capital Transit Co. (the merged street railway concern), as well as all of the common stock | of the Pepco. The North American Co. is sub- | Ject to the “death” clause of the | Holding Company Act of 1935, and | the issue of the ending of its con- | trol over local operating concerns here and elsewhere is pending be- | fore the Securities and Exchange | Commission. The investigation or- | _dered by the District Commission | brings up possibilities of more or | less parallel action by the local | regulatory body. Opinion Issued by Hankin. The Utilities Commission order | W. R. & E. exercise its pre-emptive right to buy first any stock offered by Pepco? 7. When, under what circum- stances, from whom, in what amounts and at what prices did North American either directly or indirectly or through associated companies or nominees acquire se- curities of W. R. & E. or any other public utility in the District? 8. In what other manner, if any, did North American directly or in- directly control- any of the public utilities of the District? Dividend Question. 9. When, under what circum- stances, and how much money did North American receive as dividends or other payments either directly or through associated companies or nominees, from W. R. & E. or any other District utility concern? 10. When, under what circum- stances, to whom, in what amounts and at what prices did North Amer- ican, directly or otherwise, dispose of W. R. & E. or other District utility securities? 11. What was the legal status of the acquisitions, interest and divi- dends received, and the dispositions referred to in previous questions, in Sewing Machines was issued after Mr. Hankin had | & written and submitted to Col. Kutz a legal opinion in whith he raised | a question as to whether the pro- posed 30,000 stock sale by Pepco to | W. R. & E. did not amount to & ,qu&lizinf in - Perfect DIEMONDS And complete line of standard. | ond all-Americon made watches. Shop ot the friendly store— you're aiways greeted wjth @ ‘$mile—with no obligation to SINGER treadle—a com- pletely reconditioned machine night table model ______ WHITE de luxe rotary portable, practically new__ ;49 SINGER de luxe console model that sold when new for about sss $160. In very good condition SINGER Round Bobbin Portable that looks and sews like @ sss new machi = DOMESTIC $169.95 luxe desk model somple ____ 1015 Seventh St. 22 DOMESTIC floor nmphr $34 $35,000,000, two preferred stock is- | sues totaling $7,000,000, and 60,000 shares of common stock of a par value of $100 per share, or $6,000,000, making the securities total $48,000,- | 000. He added that the unweighted | rate base of the. company, as of December 31, 1940, was in excess of $91,500,000. After referring to origi- nal cost and depreciation data he concluded: “From these figures it is evident there is now a large earned surplus and that the value of the common stock is far greater than its | par value.” | To go back to the statement that North American owns 95 per cent | of the common stock of W.R. & E., | Mr. Hankin also stated that this | should be modified by reports that sbout a year ago North American deposited 12,000 of its shares of W. R. & E. stock with the Bankers' Trust Co and the trustee issued | participating units at 40 units per | share. In other words, each share | of these 12,000 stocks were divided into 40 “shares of participating units, each of which units were sold “over the counter” at prices ranging from $17 to $23 each, and that therefore these North Amer- ican shares have been selling at | between $680 and $920 on the div- : idend basis. One expert at the District Build- ing who refused to be quoted di- | rectly said there was a serious question as to the legality of this financial deal. | He said it should be recalled that | Cross services for the armed forces. Today the District fund stands at $306,650.98. Checks should be made pay- able to the American Red Cross and envelopes marked “For the War Fund.” Any bank will accept your contribution and forward it to District Red Cross headquar- ters, 2020 Massachusetts avenue N.W. There are also booths in leading hotels, department stores and at Union Station. JUST THINK OF IT! 20 | =m)p ONE WEEK WALTZ FOX TROT TANGO RUMBA CONGA SAMBA SWING in the history n AmAzil Just once before m; i of teaching ai o in and 1511 Conn. Ave. BRING THIS AD THIS AD IS WORTH $13 DANCING We are determined to make 1942 a year of progress and success therefore we are offering this sensational offer. One- Hour Lessons COMPLETE— MORE TO PAY of dancing has such a sensation: lulr . to acquaint b thy n ke these Applicants Can Not Be Accepted After This Date. Open 12-10 Daily Victer Mahtini Studios Not Connected With Amy Other Studle (ENTRANCE 1510 19th St.) Between Dupont Circle and Q Street Submarine __(Continued Prom Pirst Page) _ | was altered, but that the escort | ship was maneuvering closer and | closer. On seeing that a collision was imminent, he said the S-26 | put her engines in reverse and that | collision quarters were sounded. | In a matter of moments, how- ever, the escort ripped into the star- | board torpedo room. | “The submarine remained station- inry 15 or 20 seconds after the im- pact,” he related, “then took a heavy down angle of perhaps 45 | degrees—and suddexdy plunged. ; “The first thing we knew we found ;ourselvza swimming. One seaman | and I swem to the escort ship, which | had halted. One of their boats | picked up Lt. Ward. ‘ “We never again saw a second |seaman who was on the bridge with us.” | The S-26 finally was located about | wire dragged between two rescue | Even if the submarine had been | located ih time to attempt to save any lives, the Navy announcement | here said, it would have been im- | possible to use the diving bell to Both Ends Flooded. A message, inclosed in a buoy and sent to the surface by signal gun, advised the rescuers that both ends of the submarine—the only | places fitted for rescue work with | the diving bell—had been flooded | and that the crew members were huddled in the central operating compartment. The design of the | conning tower structure on the S-26 | precluded use of the diving bell. Rescue efforts were made, how- ever, under the command of Rear Admiral Frank H. Sadler, comman- dant of the 15th Naval District, and Capt. Thomas J. Doyle. The Navy dispatched the U. S. S| Mallard. one of six World War type | mine sweepers converted into sub- marine rescue ships, to assist oper- | ations. | Prom Washington the Navy sent by airplane five expert divers to help those already engaged in div- ing operations. Three of these div- | ers—Chief Boatswains’ Mate For- rest E. Smith and Boatswains' Mates | George Crocker and Neil G. Shahan | | —had participated in rescue opera- ions in the sinking off Portsmouth, | N. H,, of the submarine Squalus in | May, 1939, and the 0-9 in the same | | general area last June. {‘ Diver Goes 301 Feet. It was not until January 29 that | conditions became favorable for div- | ing operations and Diver Robert : | If You Suffer With KIDNEY TROUBLE | Headache, backache. unusual thirst are | symptoms that point to kidney trouble. | For ove: 30 years physicians Wave en- J dorsed Mountain Valley Mineral Water di- rect from famous Hot Springs ATKAnsas Phone MEt. 1062 for free bookiet today anunum Valley Mineral Water ME. 1062, 904 12th St. N.W. REGULAR $20 VALUE TO ENROLL <m= BEGINNERS INTERMEDIATE ADVANCED LADIES AND © MEN YOUNG AND OLD offer been EW VICTOR Tl sant, Vetteve 1t ience. Alse o e Wa investizat leasor to Sat, Feb. 14. DU. 2167 | their lives. Axis' Drive in Libya Brifish Indicate Artillery and Bombers Pound Advance Units « Of Rommel’s Forces By the Associated Press. CAIRO, Feb. 7.—British artillery and bombers today pounded the armored advance units of Field Marshal Erwin Rommel's counter- thrust across Libya, and a com- munique suggested that for the sec- ond successive day the Axis drive ‘was held to a stop. Again, as yesterday, the war re- port said that except for patrol operations and artillery fire “there was no change in the land situa- tion.” (The Italian high command claimed Axis forces had pushed into Ain El Gazala, 40 miles west of Tobruk, and captured the oasis of Gialo, 250 miles into the des- ert southwest of Ain El Gazala.) Besides bombing and low-flying machine gun attacks along the ac- tual fighting front, the Royal Air Force reported especially success- ful attacks far back along Rom- mel’s line of reinforcement and| supply. Particularly heavy blows were de- livered at Bengasi and ‘Tripoli,| African port of Rommel's lifeline across the Mediterranean from Italy. An increasing conviction was be- ing expressed by many London oir-| cles that despite the Vichy govern- | Agness was lowered 301 feet to the submarine’s resting place. | Back came his report—and it was what everyone already knew to be certain—that none of the occupants were alive. ‘The Navy’s announcement did not give figures on the men aboard but said the normal complement of & submarine the type of the S-26, a World War type vessel which was started in 1918 and commissioned in 1223, was 35 men and four officers. Since the day of the tragedy, Comdr. Hawk and his fellow sur- vivors have been aboard ships of the rescue fleet which tried vainly to reach their comrades. News of the loss was permitted to be sent out yesterday. Persons familiar with submarine operation said that a submarine in | surface condition is more vulnerable to collision than when ready for | submersion. They added that had | the S-26 been prepared for submer- | sion its watertight integrity would have been high. Yesterday at noon a sister subma- rine submerged over the spot where | the tragedy occurred, gently releas- | ing a wreath from her periscope in | solemn tribute to those who lost Funeral Rites Held. Flags of vessels participating in a final ceremonial tribute were at | half mast and officers and men' stood with bared heads, at atiention i as both Protestant and Catholic services were read | Admiral Sadler dropped a wreath | of lilies, fern and laurel over the | spot where the S-26 had settled to | the floor of the Pacific. Then the sister of the S-26 submerged slowly, | releasing her wreath. The S-26 was the second subma- rine lost in the Canal area. The P-5 went down in 1923 off Cristobal | at the Canal's Atlantic entrance following a collision with a freighter. Only three men were lost in the P-5 and two men who were trapped were rescued when she was raised. ' and deman customers of in which we great $37, $40 Coats now. - $45 Coats now $55 to $65 Coats now. Courtesy Parking: or Star Parking Plaz. BRING THIS AD ment’s denials its ships have been convoying supplies to North Africa for Rommel's use. Some members of Parliament said they would ask in the House of Commons what steps the government is taking to plug such a leak. Ex-Bond Leader Gets - Twd Years for Attack By the Associated Press. * LOCK HAVEN, Pa., Feb. 7.—Hoy Kenneth Houck, 22, former Belle- fonte (Pa.) band. leader, was sen- | tenced today to serve two years in the Allegheny County - Workhouse | on conviction of clubbing Miss Ruth Andrews, 19, of nearby Salona, last | ¢ A-b . sentence, directed that the works house tarm be computed from September 8, the day of Houck’ arrest. He was convicted October 317 Houck was held for court thia week after a hearing before Justices of the Peace Harold D. Cowher at’ Bellefonte on five similar ch: of grabbing or striking young wos men in Centre County. - Suicide at 112 Cristina Maria da Conceicao, 112 years old and a former slave, com- mitted suicide in Madureira, Brazil, by setting fire to her clothing. Trans-Andean Route Argentina has spent $20,000,000 on the new northern trans-Andean: railway and will spend $8,000,000 ber 4. Judge Henry Hipple, who imposed | more by 1946. KALORAMA One of the finest homes in this excl MassocKusetts Avenue N.W. Built usive area—just north of 24th and for the present owner about three yeors ago; designed by a notable registered architect. The choice lot has a frontoge of 100 feet by deptl h of 135. There is o three-car ga- roge. The Georgian house is the spacious center hall plon with unusually high ceiling; all of the rooms are of generous proportions. There are six master bedrooms and four mast bath, butler’s pontry and servants’ d equipped kitchen. er baths, three servants’ rooms and ining room off the large, excellently There are several fireplaces, numerous large closets with built-in drawers, first-floor library, lavatory and powder room and ever so many other features indicative of careful plonning, including dressing rooms and spacious hallways. The privacy of the lovely garden is another feature. The beautiful architectural accomplishment. hanging stairway is an outstanding We repeat that this is one of the finest homes in this edclusive in-town BOSS AND PHELPS Exclusively Sunday or Eve. EM. 2195 section. See us and save from 10% to 25% on latest model spinets, grands, consoles, small uprights of standdrd makes. Cash or terms. Also bargains in used pianos—uprights, $25 to $75; spinets, $125 up; grands, $195 up. We are e clusive local agents for Cable- Nelson, Everett and other fine pianos. PIANOS FOR RENT « .. PHONE REPUBLIC 1590. PIANO SHOP 1015 Tth St. N.W. Piano Shop 1015 Seventh St., N. W. Sale of Discontinved Models Maytag....$55 Apex......$47 Crosley... 545 Thor.....$45 Price Includes Filler Hose Pump Piano Shop '1015-Soventh 5t., N.W. . REPUBLIC 1590 Very Easy Terms 01d Washers in Trade $3 55 Fageans %who know Fashion Park & Richard Prince Suits, Topcoats and Overcoats $50 Coats now...............--$43.75 d QUALITY in clothes are regular The Mode We have proven that rich woolens and meticulous tailoring need not be extravagant . . . we have selected our stocks with an eye to service- ability as well as appearance . . . we have brought you the famous Drape and more restrained models are specialists . . . and now we offer this superlative cloth- ing at substantial reductions in a STOREWIDE CLEARANCE Furnishings, Hats and Shoes at Winter Clearance Saving $1 and $150 Neckwear. $2 and $2.25 Fancy Shirts Clearance Prices Whitehall Shoes in Broken Sizes N.W. Corner 12th and E Sts.— F STREET «¢ ELEVENTH ; 90 Day Divided Payment Plan THE IMPORTANT MEN’S COR 4 [ | \