Pittsburg dispatch. [volume] (Pittsburg [Pa.]) 1880-1923, 1891-01-10
THE TRUST NO MORE.
The American Harvester Company
Will Wind Up Its Affairs.
LAW is TIE STUMBLING BLOCK.
Because 1t Is an Illegal Combine, Bonds
Cannot Be Floated.
THE LARGE FIRMS KICK THE TRACEs.

CHICAGO, Jan. 9-At meeting in this
vester Company. which a month or two ago
was organized with the enormous capital Of
S35, ,0O0, 900, it was decided to discontinue
the project, and the directors representing
the organization of the different States were
instructed to see that the charters obtained
in their respective States be surrendered.
President Mccormick said at the closesof
the meeting: This step has been decided
upon only after We were assured that we
could not legally carry out the objects Of
the association. Able lawyers were con-
suited, and were OF the opinion that under
the laws of these States the company could
not continue in the form in which it had
been started. Therefore, like sensible men,
we concluded to abandon the whole affair.""
No Effect on Individual Firms.
The dissolution of the company will have
no effect on the different companies or firms
which were merged into it. No change had
been made In the business arrangements of
any one OF them, and hence the action Of
the new company viii! work no change in
the firms. r .4
President Mccormick thinks there will be-
no effort made to reorganize the defunct
company. L. was only after long 6elibera-
tion that the gentlemen composing the
Harvester Trust decided to abandon it. For
more than o week the Board of Directors
has been holding daily sessions in Chicago.
The whole field of the trusts possibilities
was thoroughly canvassed and thoughtfully
discussed, and the decision was the abandon
ment of the present form of organization.
A. u
fan were the decisions OF the Supreme Courts
of Illinois and New York, the former in the
Gas Trust and the latter in the Sugar Trust
case, that one corporation may not legally
hold stock in another corporation for the
purpose of controlling it.
Bonds Could Not Be FIoated.
The interests involved were so great that
it was agreed that so, 0OO, 900 capital would
be necessary to put the combination upon its
feet. OF this sum $50, 600, 900, representing
the capital stock of the concern, was to
be apportloned among the several con-
stituent institutions, and $4,000, 900 In
bonds were to be issued for working
capital. When the company attempted to
float these bonds, the United States Trust
Company, of New York, through which the
negotiations were conducted, instituted
careful legal inquiry into the status of the
-
result OF this investigation declined to make
the loan, upon the ground that the company
had been organized in such wav as to vio-
late the statut.:s prohibiting trusts and SIM
liar combinations of capital to limit pro-
duction, and to control trade. Other fnan-'
cial institutions were appealed to, but with
the same result.
The Dissolution Practically Accomplish ed
Then it was proposed to raise the neces-
sary funds within the company itself, but
the various concerns in the firm, becoming
frightened at the legal aspect of affairs, re-
fused to tie up their individual establish
ments where they would be handicapped by
the heaviest legal and financial liabilities.
Hence nothing but the dissolution of the
] American Harvester Company remained.
/; Practically this has already been accom-.
plished, but a good deal OF red tape formal
| ity must be gone through in winding up the
! affairs of the concern. The Board OF. Dfs
| rectors to-day took the initistory steps in
| this direction.
An evening paper says: The collapse Of
| this gigantic business combine, so tar as can
| be learned, is to be attributed TO the seces-
sion of the Mccormick Harvesting Machine
| Company, the Deering Company, the Whit
man-Barnes Manufacturing Company and
| the firm of Warder, Bushnell & Glessner.
| These individual companies were not satis-
| fed with the line of policy mapped out by
the majority OF the directors In the matter
of raising prices on the farmers ard the con-
solidation of the interests of the supply
houses to the disadvantage of their Gus
toners, and were so rebellious at the meet
ing of the directory that before the night
closed they had determined to withdraw
from the combine, cut prices and annihilate
those who remained stead .ast in their pur-
pose to bleed the farmers. A merry war is
in prospect.
FANNIE b. WARD, in her letter for THE