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First Decision. Niarchos himself came within three months of being born a U.S. citizen. His emigrant parents, Spyros and Eugenia, were running a hotel in Buffalo when they decided to return to Greece in 1909. A putative descendant of the Near-chus (meaning shipmaster) who was naval chief of staff for Alexander the Great, young Stavros grew up among ships in the Piraeus, Athens' port. He was educated as a lawyer at the University of Athens, went to work after graduation for his uncles' flour-milling company. In 1935, when trade was slack, and idle ships clogged the Piraeus waterfront, Niarchos persuaded his uncles to cut their freight bills by buying ships of their own to carry grain from Argentina.
The family fleet did so well that Niar chos was encouraged to quit his uncles' business and borrow enough money to start his own shipping firm in 1939. Soon he was running seven tramp freighters from cubbyholes in brokers' offices in New York and London. That year Niarchos married Melpomene Capparis, sister of a longtime friend, Ambrose Capparis, who is now an executive in Niarchos' Manhat tan office. (The marriage ended in divorce in 1947.) With the fall of France in 1940, Niarchos decided that ships would soon be in short supply. By the time the U.S.
entered the war. he had a fleet of 14.
Leasing his ships to the U.S. and British governments, he went off to North Atlan tic convoy duty as a deck officer in the Royal Hellenic navy.
Gunwale-Deep Trouble. At war's end, with $2,000,000 in insurance from six of his ships that had been sunk, Niarchos once more bet that merchantmen would again be in short supply, despite the thousands of ships built during the war.
When the U.S. Maritime Commission announced that it would accept old hulls in part payment for new ships, Niarchos scurried around offering owners a better price than the Government, wound up with six battered freighters. Says he: "I bought anything that would float." Niarchos started off by shipping coal to Europe. But he soon scented the postwar oil boom. His reasoning: "No one wants to stoke coal if he can regulate an oil valve instead." In 1947, Niarchos started selling his freighters and made the first of several deals that were to plunge him up to the gunwales in trouble with the U.S.
Justice Department. He applied to the Maritime Commission for six T-2 tankers.
Though the ships could legally be sold to friendly aliens under the 1946 Merchant Ship Sales Act, the U.S. Navy was insisting for defense reasons that merchantmen remain in American hands.
To qualify as a buyer, Niarchos set up the North American Shipping & Trading Co., gave 75% of the stock to his U.S.-born sister, Mrs. Mary Dracopoulos, a Greek friend, George Emmanuel, who had become a U.S. citizen, and two American business associates. Though the tankers would thus be technically American-owned and were to fly the U.S. flag, Niarchos arranged a complicated deal by which the ships would be leased to a Panamanian company, thus avoid U.S. taxes. All told, Niarchos' companies acquired 8 T25 and six freighters for U.S. flag operation.