Western Newspaper Union sells to 10,732 daily and weekly newspapers 400 features, conducts in 34 plants from coast to coast a lively tradepaper & magazine printing business, jobs type, printing machinery and wholesale paper. Western Newspaper Union, world's largest publishing syndicate, is valued by its owners at a conservative $8,500,000. Last week control of this little known enterprise remained safely in the hands of the dynasty which had directed it for half a century, but only after a good stiff intramural fight.
Early in 1935, Western Newspaper Union's silver-haired President Herbert Henry Fish proposed a reorganization plan which was to scale down interest payments on W. N. U.'s bonds from 6% to 2%. President Fish explained that he wanted to "conserve principal." When this plan was announced, a committee of bondholders applied to the Federal Court in Omaha, onetime Western Newspaper Union headquarters, for permission to reorganize the company under Section 776 of the Federal Bankruptcy Act. The bondholders' committee's alternate plan called for less drastic interest reductions. The court ruled that since 1930 the home office of W. N. U. had been in Manhattan, and there the matter would have to be settled.
By the time the litigation was scheduled to appear in Manhattan, President Fish and the Omaha bondholders had come to terms. Meanwhile a third investors' faction headed by Allison L. Bayles, Manhattan investment banker, and counseled by Attorney Bruce Tuttle, had appeared. Its announced objective: To do away with W. N. U.'s present management, bring in as head man John Holliday Perry, president of American Press Association, country weekly advertising representatives. Counting noses for this fight, President Fish said he had 1,000 of the 1,200 bondholders on his side. Unable to get even a list of bondholders from the management, the Bayles-Tuttle group sought to qualify as a reorganization committee under Section 776 by securing the proxies of 25% of the company's preferred stockholders. This they did in time's nick by corralling the votes of 4,000 shares held in England.
Last week the opponents were lined up and ready to clash in court. But when zero hour came, W. N. U.'s amiable Vice President Edward C. Johnston astounded Manhattan financial editors by quietly handing out a brief announcement that there would be no fight. W. N. U. would continue to pay its 6% bondholders their 6%. All hands agreed to drop reorganization proceedings. On its part, the Fish management attributed this change of heart to improvement in rural business conditions. Everybody seemed pleased. Next day, W. N. U.'s bonds, with $8 back interest accruing, shot up 20 points on the New York Curb Exchange.