A Corporate History Rooted Deeply in Baltimore

By Martha Hamilton
The Washington Post, February 1 1999

LOUIS BLAUSTEIN IS responsible for the Amoco brand, but it's a different company with which his name is most closely associated -- Crown Central Petroleum.

Crown's corporate genealogy stretches back to the early days of the American oil industry. Blaustein, who founded the company, immigrated from either Prussia or Lithuania, depending on the account, to the United States in 1883. Blaustein worked his way down the East Coast from New York as a peddler, eventually ending up in Baltimore.

Blaustein got into the oil business when he noticed kerosene leaking from cracks in a large wooden barrel in a grocery store, according to a 1937 account in the Baltimore American newspaper.

Blaustein came up with an alternative, a horse-drawn "tank wagon" -- the predecessor of today's railroad tank cars and galvanized tank trucks. The wagon, pulled by his white horse, Prince, and mounted with a steel tank with a spigot, allowed him to sell kerosene (the refined oil product that was displacing coal oil and whale oil for lighting) to grocers in oil cans just after the turn of the century.

By 1910, Blaustein was taking advantage of the growing popularity of the automobile to use his tank wagon to deliver gasoline. Blaustein incorporated his business as the American Oil Co. in 1922. It would later become known as Amoco. Blaustein's son, Jacob, who would become his successor, was forced to drop out of Lehigh University in his last year because the family couldn't afford it. When Louis Blaustein developed an interest in a highly volatile chemical called benzene, he, Jacob, who had studied chemistry, and a chemist experimented until they came up with a fuel that combined gasoline, benzol and another ingredient in a "high-test" motor fuel.

Unique because it was colorless, the product was called Amoco by Louis Blaustein because he wanted customers to ask for it by a brand name instead of asking for generic gas. The next step was to open the first company-owned filling station, part of a network of Lord Baltimore Filling Station outlets that sold Amoco. The chain would soon include Washington, Virginia, Philadelphia and Western Maryland. In 1923 the family sold a half interest in the American Oil Co. and Lord Baltimore Filling Stations to the Pan American Petroleum & Transport company in return for a guaranteed supply of crude oil and refined products. Before the deal with Pan American, American Oil had depended on Standard Oil of New Jersey, its biggest competitor, for raw gasoline supplies, according to an Amoco corporate history.

But the deal that seemed to secure the company's future was compromised when Standard Oil of Indiana acquired Pan American in 1925. According to the terms of that acquisition, American Oil's "guaranteed supply" would only run until 1933. That gave the Blausteins concern. According to the corporate history, "the Blausteins alleged that Standard Indiana had pre-empted corporate opportunities for its own benefit to the detriment of Pan American Petroleum and Transport stockholders. It was a classic example of minority stockholder claims that a partially owned company was being run for the benefit of parent company shareholders at the expense of minority interests."

Ironically, similar claims are being made in recently filed shareholder litigation against Crown's management.

Years of negotiations and litigation followed, with the Blaustein family -- which includes his grandson, Henry A. Rosenberg Jr., the current chairman of Crown -- ending up with a large holding in Standard Oil of Indiana, which eventually took on the Amoco name. Amoco is now part of the global giant BP Amoco, in which the family still owns stock. In 1930 a group of businessmen from Baltimore led by Blaustein acquired Crown Oil and Refining Co. of Harris County, Tex. They would reorganize it and rename it Crown Central Petroleum Corp. Crown's origins date back to 1917, when a drilling crew brought in a successful oil well. With revenue from that well, the company built "its own refinery -- one of the first to be located on the Houston Ship Channel," according to a Crown Central account.

The Baltimore investors moved Crown into gasoline retailing, buying a tank wagon and opening a chain of 30 stations in the Houston area in 1931. Crown opened its first stations in the Baltimore area in 1943.

In 1983, Crown entered a new phase of the business, buying two convenience store chains, Fast Fare and Zippy Mart, to expand its retail operations. It sold its exploration and production operations in 1987, focusing on refining and marketing, and purchased the La Gloria Oil and Gas Co. and its refinery in Tyler, Tex., in 1989.

Copyright 1999 The Washington Post Company
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