The huge holding company is a modern development. In the early. days of the present century destructive competition between electric light land power companies was. reply by the grant of a monopoly or "francchise" to some single concern. In re-tum for the franchise the company submitted to control of its rates. The second stage in. the development the electrical industry took place between 1910 and 1920. "Small local operating companies were bought up. by corporations formed specially for the purpose of buying them up. Some. slates did not allow a corporation to hold stock in another corporation but moat did. Holding companies acquired operating companies, or acquired 9 controlling share in them without rst. arousing much opposition. Tha: holding companies fulfilled a useful function, Expert) management _was provided small companies which would otherwise have been unable to afford it, operating expenses were reduced and the polled resources of the various small operating com: panies gave additional financial secur-Hy to each: The public benefitted by lower rates,
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