CORPORATIONS: From Corn to Gas

Deep in the Illinois farm country, 150 miles south of Chicago, more than 200 industrialists, bankers, engineers and newsmen gathered at little (pop. 3,000) Tuscola last week for the dedication of a $50 million, 500-acre petrochemical plant. Where corn stalks had rustled only two years before, giant cylindrical storage tanks marched row on row; instead of silos, towering fractionation columns glistened in the sun. The new chemical complex to make dozens of products from natural gas was startling in another way. It is 60% owned by the second-largest U.S. liquor company—National Distillers Products Corp.*

National Distillers has found no revolutionary way of extracting such whiskies as Old Taylor, Old Grand-Dad and Old Crow, or any of the company’s 55 other liquor brands, from natural gas. But National’s President John Edward Bierwirth does think he has found a way to make National grow faster by expanding outside of the liquor business. In the four years since Bierwirth became president, National has put $82 million into the chemical industry. The Tuscola petrochemical plant, owned jointly with Panhandle Eastern Pipe Line Co., is its biggest chemical investment to date. From natural gas, the plant each year will pour out 20% of the nation’s supply of synthetic alcohol, used in hundreds of products ranging from synthetic rubber and explosives to photographic film and DDT; 200 million lbs. of ethylene; 50 million Ibs. of ethyl chloride, for tetraethyl lead in high-octane aviation gasoline; 140,000 tons of sulphuric acid. In addition, Tuscola will soon have a $7,000,000 ammonia plant and a $14.5 million plant for producing polyethylene, the tough, flexible plastic that goes into squeeze bottles, poker chips, etc. (TIME, May 11).

Wine & White Rock. Though he is a banker by trade. Yaleman Bierwirth, 58, has amazed the liquor industry by his daring. A first lieutenant in World War I, he spent ten years with a contracting firm before joining the New York Trust Co. as a vice president in 1929. He was made president in 1941. Four years ago, when National Distillers’ longtime boss, Seton Porter, was looking around for a successor, Bierwirth took the $150,000 job on one condition: that National would go heavily into chemicals, which he considered the most promising field in industry.

Before going far into new fields, however, Bierwirth found that he had to get

National out of some unproductive old lines. One such was the White Rock Corp., another was Italian Swiss Colony Wine Co. (TIME, April 27); a third was Henry H. Shufeldt & Co., which processed glace fruits as well as maraschino cherries and olives for dunking in National’s liquor. Bierwirth sold them and all the rest, realizing $3,000,000 over their book value.

“If You Had Money.” National’s first big move into chemicals was to build an $11.5 million plant for producing metallic sodium and chlorine at Ashtabula, Ohio; with sales of $8,500,000 a year, it now has the highest profit margin of any National division. Next, Bierwirth paid $6,700,000 for a 25% interest in U.S. Industrial Chemicals, Inc. (industrial alcohol, antifreeze, resins, etc.), has since merged the company with National. He then bought a 20% interest in Intermountain Chemical Corp. (soda ash), and for $4,500.000 bought Algonquin Chemical Co., Inc. (caustic soda, sulphuric acid, chlorine).

One day in 1951, Bierwirth asked Vice President Robert E. Hulse, National’s chemical chief: “If you had money and wanted to go into the chemical business, which branch of it would you pick?” When Hulse answered “petrochemicals,” Bierwirth went upstairs from his Manhattan office at 120 Broadway to see an old friend, William G. Maguire, chairman of Panhandle Eastern Pipe Line Co. Within half an hour they made a deal to set up a jointly owned company. National Petro-Chemicals Corp. They picked Tuscola, Ill. as the plant site because it is a key junction of Panhandle Eastern’s pipe lines from the gas fields of Texas, Oklahoma, Kansas and Louisiana.

Bierwirth’s move into chemicals has already begun to pay off for National. Sales are up from last year, and net before taxes for the third quarter hit $6,600,000 v. $4,500,000 a year ago (aftertax earnings showed a smaller rise). Chemicals, which now account for nearly 25% of National’s $470 million annual sales, will probably account for 35% next year. Eventually, chemical production is expected to account for more than half the company’s profits.

* Largest: Schenley Industries, Inc.