Lehman Brothers Collection - Contemporary Business Archives

Harvard Business School Baker Library Historical Collections

Lehman Brothers Collection

Twentieth-Century Business Archives

North American Royalties, Inc. - Lehman Brothers Collection

North American Royalties, Inc.

List of Deals

North American Royalties was founded in 1952 to invest in oil and mineral resource royalties. North American Royalties began operation at the end of the oil-wildcatting era, as independent oil operators declined during the 1950s and the industry consolidated under a few large operators. The company succeeded in this environment by expanding its interests nationally and by acquiring new royalty rights over land, which exist in perpetuity.

The company organized by issuing stock in exchange for properties held by the Rican Corporation, United Properties Incorporated, Northwest Investment Company, and Leach and Kelsch. Both the Rican Corporation and United Properties, Inc., were founded in 1951. Leach and Kelsch, as a joint company and as individuals, acquired their holdings from 1936 to 1952. Three of the founders of North American Royalties—Thomas W. Leach, Frances Leach, and J.M. Kelsch—controlled more than 35 percent of the common stock at its issue in 1953. The company’s headquarters was in Bismarck, North Dakota.

The initial stock prospectus described North American Royalties as a “speculative security.” The company was engaged in exploring for oil and minerals. Thus its business was risky, but offered a large potential reward. The stock was initially issued at $6.10, with one dollar par value.

The company began by investing in interests in the Williston Basin of North Dakota, South Dakota, Montana, and Manitoba. The company acquired additional interests in Texas, Wyoming, Louisiana, New Mexico, and Oklahoma over the 1950s and 1960s. It also controlled a wholly owned subsidiary, Missouri Valley Minerals, Inc., which held royalty interests in Schleicher and Brazoria Counties in Texas. The deal book contains extensive descriptions of the land in which North American Royalties held interests.

North American Royalties merged with Gordon Street, Inc., of Chattanooga, Tennessee, in 1969. Gordon Street manufactured gray iron castings for use in automobiles, as well as doing some business in oil and gas. Although the company name remained North American Royalties, Gordon P. Street himself became the chairman and president of the company, and the Street family held a controlling interest.

North American Royalties became a privately held company again in 1983. A shareholder group led by Gordon Street Jr. headed the buyout for nineteen dollars per share. Wheland Automotive Industries, the successor to the iron castings division, declared Chapter 11 bankruptcy in 2002.

Note: The deal book contains maps of areas of the Williston Basin in which North American Royalties held land at the time of the initial public offering in 1953.

Harvard Business School Harvard Business School Baker Library Histrorical Collections