New-York tribune., 1901-12-22
T ]. HILLS SIDE OF CASE
PRESIDENT OF NORTHERN SECURITIES
COMPANY TALKS OF MERGER.
Union PACIFIC WAS SEEKING TO BUY BUR
ZINGTON-SELF-PROTE OF
GREAT INTERESTS

T-NIoN PACIFIC WAS SEEKING TO BUY BUR
L1NGToN-sELF-PRoTE OF
GREAT INTERESTS.
ST Paul, Mimi, Dec 21.-J. ]. Hill president
of the Great Northern Railway and of the re-
Gently organized Northern Securities Company,
+tis afternoon gave the following statement to
The Associated Press:
I have been absent from Minnesota more than
two months, and in that time there has arisen
2 wide discussion throughout the State of what
has been generally called a consolidation or
merger Of the Northern Pacific and Great North
ern railways. and in this discussion statements
have been made which so widely different
from the facts that 1 feeh called upon to make
a conservative statement of just what has been
done in the past and what will be done in the
future.
banking house of J. P. Morgan & Co. reor-
ganized it, myself and friends were holders of
large amount of that companys securities.
bought about S26000000 of Northern Pacific
stock both common and preferred. Some of this
stock was afterward sold. but large amount
has been held from that time to the present.
About year ago the Union Pacific company
bought the Huntington and other interests in the
Northern Pacific, and at the same time made an
effort TO buy the control of the Chicago, Bur
IingJOn and Quincy.
With these lines in the hands of the Union
Pacific interests both the Northern Pacific and
Great Northern would be largely shut out OF
the States of Nebraska, Kansas, Missouri, South
lDa kOIa. Iowa. ILLINOIS and Wisconsin, except bS
using other lines of railway some of whlch were
in the market for sale and might ar any time
pass under the control of or be, combined with
the Union Pacific interests. We then. with the
Northern Pacific made proposals to the directors
of the Burlington to buy their entire property:
When this transaction was about being closed
the people who represented the Union Pacinc
company and who had previously tTied 10 puy
the Burlington asked TO be allowed TO snare
with rs in the purchase of that company rms
proposal we refused, for the reason that II WOULD
defeat our object in buying the Burlington. ana;
further. it was against the laws OF seDepa' ,l oa
the States in which the longest nllIedSe VI 'iie
Burlington located.
L. P. BUYS N P. STOCK.
4. +,a+ .,r,a against the opposition of the
7oore southern lines both the Northern Pacinc
and Great Northern had put into erect d 10"
colonization rate. and were carving oaIs "
sands OF people into the Northwest, many VI
whom were coming from Kansas and Nebraska
along the lines of the Union Pacific rms move
Inent was at its height in the nonIh oi ApL-i
and after we had closed the purchase OF the
Huntington the Union Pacific people unoerlooh
the boidest effort that was was eye eNeT n f a. +orE
country and bought over S6o,ooo,eoo OF the stoch
of the Northern Pacific in the markets OIL Eu-
rene and the United States. l was IN New
York ar the time. and after Messrs. Morgan q
GO wera aware of the action of the Union Pa
ci6c r,eopla il was found that together we held
about $50 100000 Of Northern facihc coiiIiiiS i t
S+ocI-. Ind 1nasrauch as the common stock, pE
q right of a contract made with the pre1eFre9I
stockholders when the company was reor sdlIHeu
and the stock issued had the prlVllege oL Pas ls
+f ,ba ,,raferred stock at par the first day or
January of any year until 1911 MessIs, 1loI -I s.
& Co then bought in London ana Ne"-t ot ia n
about S16oOoOeO OF the C9lllhoh 9'0 20 ~
Northern Pacific -. ,,oo.a ,-+ares+s
having already so large an lnEesIeIt H;oo oL cor
stock up until there was the largest stoSh ooa
ner ever known: the common STOCK IA ited IN
four days went up TO Sl,ooo a snare. eA s ~
10 my friends how that, with controi c,9 9i @ o,le
Northern Pacific the Union Pacific would CON
trol the entire Northwest and the west rom
Mexico 10 the Canadian Line. except 1or lLe
T.-aa+ Nor+hern So great was the effort TO get
This control that to one Of my friends In Lon
common was offered. and he refused, si4.oV,-
0o0 for his stock The result was that MessIs; sEo
Morgan & Co. and ourselves owned S4-'qoo.veeo 8N9e
ont Of SS0Oo0000 OF the Northern racine
common with the privilege Of paying on .he
$4,000 600 of Northern PACIFIC preferred. me
common and about S42 100000 of the preferred
which was clear majority OF all the stoch oI
the Northern Pacific, and claimed tns 80
control of the Northern Pacific Railway, ana,
through that ownership, control OF one-he!I oA
the Burlington. When Il was known that mess
preferred shares could and would De palo on
90 before the annual election. mutual negotla-
lions resulted in Mr.. Morgan giving Inenl q
representative in the Northern Paclhc va S az
Al the same time I was elected memper OF tis
Northern Pacific board. When was ADVISED OF
NV election informed them that l couId no nol
legally act as director Of the Northern FaclLc
I'D Great Northern at the same time, and re-
signed after the first meeting or the ooaro'
TO PROTECT VESTED INTERESTS.
Several of the gentlemen who have long been
interested in the Great Northern Halfway aho
its predecessor, the st. Paul Minneapolis anu
NTani+oha and who have always been among
5rS largest shareholders, but not the holders OF
q mo ioritv of It's stock, whose ages are from
ea,-an+1- RI eightv-six years, have desired TO
combine their individual holdings in corporate
form and in that way secure perrnanent pro-
-ac+ioo for their interests and q continuation OF
the policy and management which mas Done SO
much for the development OF the Norlh"eSl anu
-ha hanrement of their own property IN the
Northwest and elsewhere. out OF thls desire
has grown the Northern Securities company. IL
became necessary. in order to prevent the
rrol of the Union Pacific interests. and with II
the Joint control of the Burlington 10 pay OH Ie
ST. 600 600 of Northern Pacific preferred Inc
enorrno,Is amount Of cash required for this pur-
nose from a comparatively small NUMBER OF
mon made II necessary for them TO act togetneT
IN ? large and permanent manner through the
medium of a corporation, and the Northern Sc
entities Cornnany afforded them the means of
ACCOMPLISHING this object without the necessity
of creating separate company 10 nnance the
transactions for the Northern Pacihc; whlle, at
the same time the credit Of the Northern Sc
cIrritirs Company would be much stronger, as
II would also hold q considerable amount OF
Great Northern and other securlles
The Northern Securities Company Is organized
n 6aaI in high-class securities, to hold the same
for the benefit Of its shareholders ana TO ao-
vance the interests Of the corporations Wiose
securities II owns. Its powers 90 not lhcIuue
the operation of railways, banking, mining nor
the bT1ving OF selling Of securities or properties
for others on commission; II is purely an invest
ment company and the object OF its creatioii
was sin1ply TO enable those who hold It's STOCK
70 continue their respective interests in associa-
ton together and TO prevent such interests from
heinz scattered by death otherwise 10 pro