CORPORATIONS: New Variety

In 77 years nothing like it had ever happened. Outsiders were to be invited into the family-owned H. J. (“57 Varieties”) Heinz Co. In Pittsburgh last week President Henry John Heinz II announced that the company would soon make its first public stock offering: 100,000 shares of $100 par cumulative preferred, 200,000 shares of $25 par common stock. The reason: heavy taxes had made it impossible to finance expansion out of earnings any more. The company had to ask the public for cash to do the job.

It was a melancholy admission for 38-year-old Heinz to make. For the first time Tom, Dick & Harry would have some kind of say in the company the Heinzes had built and controlled for three generations. Henry John had founded the business in 1869 by hawking horse-radish from door to door; son Howard had lifted sales to $62,000,000 before he died in 1941; grandson H. J. II had kept them moving on up.

Up from Under. When H. J. II was a young man, Winston Churchill once advised him: “You should begin at the top and work down.” Heinz preferred the sober counsel of his grandfather: “Do a common thing uncommonly well.” Working from the bottom up, he has performed uncommonly well the common task of selling common foods.

A graduate of Choate and Yale, he started as a pickle-salting hand for $1 a day in the Plymouth, Ind. plant where his father started before him. Later stints in the Berkeley, Calif, plant as cleanup man and in the London branch as pickle peddler helped him through the lower ranks. In 1936 he settled down in Pittsburgh for final grooming before taking over the family empire.

When his father died in 1941 he stepped into the presidency. To his twelve directors (all but one of them operating department heads who had come up through the ranks), he said briskly: “Keep me straight.” They did. Business went on as before—only there was more of it.

More of the Same. In five years the company spent $15,000,000 on new plants and equipment. Sales boomed up to the $100,000,000 mark. By 1946 it was a safe bet that most of the grocers in the U.S. and all major foreign countries had an assortment of Heinz’s 57 varieties on their shelves.

With its new outside capital the company will redeem $5,150,000 worth of outstanding preferred stock. The balance it will probably use to build bigger plants, market new varieties. Prospective investors, getting their first look inside the Heinz door, saw an appetizing sight. Last week Heinz reported that sales for the year ending last April 30 were $114,150,564. Net profit, $4,052,084, one of the best in the company’s history.