Collection of the Museum of American Finance
Portraits of William M. Kidder and Horace J. Morse in Kings View of the New York Stock Exchange.
Christopher Bay, a scholar, mathematician
and Norwegian immigrant, Charles
Ulrick Bay was born in Rensselaer, NY.
An industrialist, Bay founded the Bay
Company, a surgical and medical supplies
manufacturer, with his brother, Frederick.
In 1933, while a partner at A.M. Kidder, he
also founded the Bay Petroleum Company
in 1935 and the American Export Air Lines
in 1937. In 1938, he helped to organize
A.M. Kidder’s takeover of Jenks, Gwynne
& Co., a well-known stock, cotton and
grain brokerage founded in 1913.
In 1940, Bay became senior partner of
A.M. Kidder & Co. In 1946, however, he
became the ambassador to Norway under
President Harry Truman and took a leave
of absence from the firm until 1953. When
Bay died in 1955, he owned about 71% of the
firm’s stock. In 1956, his wife, Josephine Perfect
Bay, assumed his position as the president
and chairman of A.M. Kidder & Co.,
Inc. because the New York Stock Exchange
rules required any stockholder who owned
“more than 45% of a member company’s
shares” to either sell or “take an active part in
the firm.” Under Josephine Bay, A.M. Kidder
& Co. had the distinction of being the
only investment house in the top 207 firms
of the syndicate of the Ford Motor Company
initial public offering led by a woman.
Born in Iowa in 1900, Josephine Holt
Perfect Bay was raised in Brooklyn. The
daughter of Otis Lincoln Perfect, a real
estate broker, she was a 1916 graduate of the
Brooklyn Heights Seminary and studied
at Colorado College at Colorado Springs.
She and Charles U. Bay married in 1942.
In 1959, she remarried to Capton Michael
Paul, a widower and a native of Ulanvdinsk,
Outer Mongolia. Paul’s father, Michael A.
Iogolevitch, had been the Surgeon General
under Czar Nicholas. A trained violinist,
Paul immigrated to the United States in
1917. In 1919, he opened a branch bank in
Harbin, Manchuria for the National City
Bank of New York after meeting Frank A.
Vanderlip, the bank’s president. In 1922,
he started his own firm dealing in precious
stones and art. Eventually he settled in
Texas, where he entered the oil business.
He joined the NYSE in 1933.
Josephine Bay Paul died in 1962. The
following year, C. Michael Paul—then the
president, chairman and chief stockholder
of A.M. Kidder & Co., Inc.—decided to
sell the firm to Reynolds & Co. and Francis
I. duPont & Co. Paul said, “Since I have
had no one to share the burden of running
the firm as I had when Mrs. Paul was alive,
I thought it best to hand it over to others.
I want to have more free time for all my
activities—the medical and educational
philanthropies with which I’m connected
and also my bowling and fishing.”
According to Paul, Reynolds and
duPont approached him about the sale,
which was for cash. Paul said that he did
not want to devote the time necessary
to expand the business and maintain its
quality, so he decided to sell.
According to Vartanig G. Vartan,
Reynolds & Co. and Francis I. duPont
& Co. were part of a larger merger trend
for which there were “two prime reasons”
in the securities business: “the chief
one being the drive for greater capital….
Brokerage firms need capital to carry
customer margin accounts, to conduct
their underwriting business, to pay for
expanded research activities, and to aircondition
their offices.” The second reason
was “personal or estate acquisitions,” like
C. Michael Paul’s personal circumstances.
In the post-war period, A.M. Kidder &
Co. had established its reputation for successfully
selling mutual funds in Florida.
In 1947, it bought 10 offices of another brokerage
house in Florida. By 1961, it had 22
offices in Florida and realized “about 85% of
its total mutual fund volume from the Sunshine
State.” The New York Times reported,
“Under terms of the acquisition agreement,
Kidder’s assets [were] divided equally
between Reynolds and duPont. Reynolds’
half [was] made up of 26 of Kidder’s offices,
and duPont’s [was] the remaining 13.” The
Florida offices were taken over by Reynolds
& Co., which were not represented there
and “said that it was interested in pursuing
mutual fund sales in the Southern state.”
With that sale, the name of A.M. Kidder &
Co. was lost to history.
Susie J. Pak is an Associate Professor in
the Department of History at St. John’s
University (New York). A graduate of
Dartmouth College and Cornell University,
she is the author of Gentlemen
Bankers: The World of J.P. Morgan
(Harvard University Press), a Trustee of
the Business History Conference, co-chair
of the Columbia University Economic
History Seminar and a member of the
editorial advisory board of the Business
History Review. She is also a member
of the Financial History editorial board.
About Where Are They Now? The “Where
Are They Now?” Series traces the origins
and histories of 207 of the underwriters of
the 1956 Ford Motor Company IPO. The
research for this series has been generously
funded by Charles Royce of The Royce
Funds. The Museum’s “Where Are They
Now?” blog can be found at: wherearetheynowblog.blogspot.com.
www.MoAF.org | Summer 2020 | FINANCIAL HISTORY 37