Business: Meat Matters

During the past dozen years Swift & Co., largest U. S. meat packer, has bought up 20 small packing houses. Last week Swift bought out its 21st little competitor,

Arnold Bros, of Chicago, because it was “a nice little business.” President Hugo Arnold announced the sale from his office in the West Randolph Street building where his father and four uncles started a meat business 68 years ago. Square-jawed Hugo Arnold, now 63, without a son to carry on the family name, has wanted to retire for ten years, took his time waiting for the right purchaser for his $1,000,000-a-year business in sausages and smoked meats.

Swift last week also saw the finishing touches being applied to a meat matter which had caused the firm considerably more cogitation than the Arnold deal. Offered for sale by underwriters, headed by Boston’s Jackson & Curtis, was $10,000,000 worth of bonds and stocks in United Stockyards Corp., a new corporate entity which last September purchased Swift’s large interests in one Canadian, seven U. S. stockyards. In 1920, to avoid Government prosecution under anti-trust laws, Swift and the other big packers signed “consent decrees” pledging themselves to get rid of stockyard holdings. Wilson and Cudahy divorced themselves from their relatively small stockyard interests within a few years, Armour took until 1928. Swift, by far the largest owner of stockyards, litigated, delayed, took the last four years to find a purchaser, agree to details.

Swift will get $7,324,470, Swift stock-holders $1,567,000 for their holdings in yards which do 20% of U. S. stockyard business. Mainsprings of new United Stockyards Corp. are Banker John DeWitt and longtime Swift Executive Wesley K. Wright. Mr. Wright will soon move from Swift’s plant on the South Side, from which he has managed Swift stockyards for the past 14 years, to Chicago’s Board of Trade Building as president of United.

In promotion material which went to salesmen peddling $4,500,000 in United’s 41% collateral trust bonds, 310,000 shares of preferred stock at $12 a share, 224,000 shares of common at $8, was a set of 20 questions and answers about stockyards in general, United Stockyards in particular.

Question No. 1: What is a stockyard? Answer: A stockyard is a public market place strategically located as to source of supply of all classes of livestock.

Question No. 5: Where do major packers have their packing plants? Answer: Major packers have their plants surrounding the stockyards to which livestock purchased is driven direct for slaughter.

Question No. 13: How would a war affect stockyards’ earnings? Answer: During the World War earnings of these properties [in United’s new setup] were abnormally large due to contracts placed with packers for Army and Navy supplies.