Business: Rum Rush

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National Distillers, The Whiskey Trust of pre-War days was a pretty poor apology for the ogre it was damned for. Most of the business was in the hands of local distillers and nine-tenths of the saloons were controlled by the brewers. The old Distilling Co. slipped steadily until the War. It made $10,000,000 in a final spasm in 1918, changed its name to U. S. Food Products Corp. after Prohibition, finally collapsed in 1921.

Not knowing what to do with the derelict Trust, bankers called in the great engineering firm of Sanderson & Porter to find out whether it should be salvaged or scrapped. A younger brother and junior partner of the founder Hobart Porter was assigned the job. Blond, dapper, fond of horses and tennis, Seton Porter graduated from Yale in 1905. A good engineer, he was assistant manager of a construction company on the West Coast before he joined his brother's firm. He recommended that the Trust be salvaged. The bankers were willing to take his expensive advice if he would do the salvaging.

In 1924 President Seton Porter of National Distillers Products Corp. took command of a hodge-podge of subsidiaries that made alcohol, yeast and maraschino cherries. He had a fair share of the dwindling medicinal liquor business and 9,000,000 gal. of fine old whiskey which belonged to people who had bought the warehouse receipts. He sold some of the subsidiaries, paid off $11,000,000 of debts, bought back most of his whiskey. But around his clubs when asked about his whiskey business, Seton Porter usually made a sour face, and did a quiet but extraordinarily able job of corporate management.

When Seton Porter sensed the groundswell of Repeal, things began to hum. One wintry day in 1932 he called up Henry Mason Day, the big, grizzled, taciturn partner of Redmond & Co. who loyally went to jail with his good friend Harry Ford Sinclair for jury-shadowing. Mr. Day picked up one of the seven telephones on his desk and listened to Mr. Porter's suggestion that National Distillers, aside from the dynamite of Repeal, was a pretty good thing at around $16 per share. Mr. Day cocked an eye at the ebony elephant on his desk. Mr. Porter needed to raise money for expansion. Mr. Day took 20,000 shares for his clients.

Since then Mason Day has never been very far from Seton Porter in his busy preparations for the big stampede. Among other things Mr. Day got the ear of President William E. Levis of Owens-Illinois Glass, who bought 40,000 shares of National Distillers for his bottle company. That deal on top of the famed whiskey dividend (one case, pre-prohibition, for each five shares) made Wall Street acutely conscious of National Distillers. In last summer's boom its stock hit a high of $124. Last month National Distillers contributed the first major stock-split to the New Deal market—three for one.