CORPORATIONS: What the Country Needs ...

The Chicago Corp. is a well-heeled investment trust which likes to take fair chances, calls its operations "enterprise financing." Some 18 months ago, Chicago Corp. took the biggest chance of its corporate life. It sank more than $12,500,000 of its own cash, and another $44,000,000 borrowed from the Reconstruction Finance Corp., into building the longest natural gas pipeline in the world; 1,265 miles from its rich fields near Corpus Christi, Texas to West Virginia, hub of the profitable northern market.

By the time the job was done last November, the pipeline had turned out to be an investor's dream. In the first two months, Chicago Corp. and its pipeline-building subsidiary, Tennessee Gas & Transmission Co., took out $357,000 in profits. Yet last week, Chicago Corp. took the first step towards getting rid of its prize baby. Reason: the Federal Power Commission was probing to see if the building of the pipeline by Tennessee Gas had turned Chicago Corp. into a natural gas company.

This would automatically give FPC a big voice in the Chicago Corp.'s affairs. More important, it would limit much of the profits from the corporation's chance-taking to 6½%, not enough to make it worth-while to go on taking long chances.

So last week Chicago Corp. put through a deal of Tennessee Gas to raise $42,750,000 by issuing bonds and preferred stock on the pipeline, get another $15,000,000 in bank loans. With the money, Tennessee Gas will pay off the loans of the RFC and the Chicago Corp. Now, if the FPC decides that Chicago Corp. is a natural gas company, it will simply get rid of the pipeline either by 1) selling it outright or 2) giving it to the stockholders.

Take a Chance. All this was disconcerting but not discouraging to Chicago Corp.'s bantam-sized president, Richard Wagner, 48. Born of poor immigrant parents in a down-at-heels section of Chicago's North Side, Dick Wagner started to earn his own living at 14 as a bank runner in Chicago's Continental bank. He scooted up fast. At 16, he was secretary to the president; at 19, he was writing speeches for bank bigwigs; seven years later he was a vice president.

When the bank's anemic investment trust and two others were merged into Chicago Corp. by shrewd, dressy Charles Foster Glore (TIME, Nov. 28, 1932), Charlie Glore (whose Glore, Forgan, & Co. helped put through last week's financing), became president. He picked Dick Wagner as vice president. At that time they hoped to keep busy and make money by financing new Midwest enterprises. But the depression scared everyone out.

Cash In. So Wagner and Glore, who hated to see the corporation's cash in stocks & bonds instead of sparking new business, tried their luck on Chicago real estate, began to dabble in Texas gas & oil. They saw a fortune to be made in waste natural gas. Texas oil wells within ten miles of the present pipeline alone were blowing it off at the fantastic rate of 200,000,000 cubic feet a day because there was nothing better to do with it.

Wagner, who had been upped to president when Charlie Glore became chairman of the executive committee, sank $500,000 in a new process for extracting gasoline from gas, enthusiastically leased vast tracts of "worthless" gas lands, set up a string of money-making oil and gas subsidiaries.