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Out on a Limb? The Murchisons concentrated on the 50% of independent stock held on Wall Street for clients, and worked over brokers and customers' men, using their widely scattered interests to win banks, businessmen and stockholders to their side. They divided the country into regions, devised a canvassing system by which recalcitrant pro-Kirby stockholders were referred progressively upward until they found themselves being charmed by the Murchisons themselves. When the votes were counted, the Murchisons had won 2,200,000 independent votes to Kirby's 1,000,000—enough to give them an overall 800,000-vote edge. Wall Street, which loves a gambler, voted the stocks in the Street's name 4 to 1 for the Murchisons.
Murchison control of Alleghany remains highly conditional. Kirby still owns 34% of Alleghany—and could buy outright control if he had a mind to. "The Murchison boys want me to sell out," says Kirby, "but I won't. That's one thing I won't do. I'd say the Murchison boys are way, way out on a limb." Kirby does not intend to help them crawl in. "I have no confidence in the Murchison boys," he says flatly. If the Murchisons fail to put on a spectacular performance in making Alleghany go up, the grudge-holding Kirby may well be tempted to try to regain control.
In a Fishbowl. The Kirby cloud over Alleghany may force the brothers to modify their business style. With their usual yen for good management, they are looking for a strong executive to take over Alleghany; one much-discussed possibility is Eisenhower's Treasury Secretary, Robert Anderson, a Texan. But any topflight executive is apt to think twice before taking on a company that could change hands again within a year.
John Murchison is temporarily acting as Allegheny's president, and is uncomfortably involved in deeper management decisions than he ever has been before. Right now his prime concern is Alleghany's interest in the ailing New York Central, which he considers "just a lot of problems." Says he hopefully: "The Eastern railroads are ready for a merger, and I think that the New York Central would be a splendid contribution to any merger." But given the slow-freight mentality of the Interstate Commerce Commission in arriving at decisions, and the complex corporate intrigues at work among the Eastern railroads, getting rid of responsibility for the Central is not likely to be easy.
The Murchisons are reluctantly facing up to the prospect that they may not be able to wheel and deal as freely as before. They are currently considering such non-Alleghany deals as leasing a ranch in Hawaii for a major real estate and housing development, financing a monorail system, merging two insurance companies, and constructing two new cement plants. But, says John: "Our involvement in Alleghany is now so heavy that we are going to have to concentrate on that for some period of time. We may see ourselves shifting away from other investments to solidify our position there. There has been such a spotlight on Alleghany that we have to expect that whatever new venture the Murchison brothers go into, some Alleghany stockholders might complain: 'Why didn't you put that deal into Alleghany?' We're going to be operating in a fishbowl, and we have to be supercautious from now on."