The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1902-03-27
Illustrates the Value of Friendship
i'm Times Like the Northern
Pacific stock FURRY.
HISTORY OF A GREAT DEAL
HOW THE BATTLE FOR CONTROL OF
A RAILWAY WAS WON.
kodnkers Not Permitted to "Snap-
Shot" the Money king-FIis Con-
duet Under Examination.

NEW YORK, March 26.-J. Pierpont Nor
gan gave evidence to-day before Special
Examiner Mabey i'm the suit Of Peter Pow
er against the Northern Pacific Railroad
Company. He was questioned for two
hours and a half by George Alfred Lamb,
of counsel for Power and during that time
he answered questions rapidly and without
the slightest appearance of reserve. Only
once or twice. when questions were asked
concerning the relationship of j. z. Nor
gan & Co. with the firms customers, did
he decline TO answer.
Before the hearing opened Mr.. Nor
gan objected to the presence of a number
OF photographers. and they were directed TO
leave the room. During the examination
Mr.. Morgan leaned back heavily in his
chair, MS left hand thrust from time 10
time deeply in his trousers pocket. He
toyed with an envelope impatiently, now
knocking IL against his knee. now against
the table which his right arm rested.
His eyes expressed impatience. They
roamed about in extreme restlessness while
questions were being put TO him, but the
moment he was ready to answer they fixed
themselves on Mr.. Lamb.
Several times during the hearing the
financier seemed amused. Once Mr.. Lamb
asked if the price of Northern Pacific did
not go above its real value while his firm
was buying it in May, 1901. NO" said Dir.
Morgan, so amused that he had 10 stop
TO control himself before he answered.
1T did when they came TO deliver the
stock, but not when they actually bought"
AT another point the witness was asked IL
Mr.. Hill had not told him that there was
danger that the Hartman syndicate would
buy the Burlington. NO" replied he. but
such a thing was only 10 be expected The
papers had much in them about the rail-
road interests buying roads. / believe that
within a few days we bought every railroad
in the United States" and Mr.. Morgan
laughed.
After his examination Mr.. Morgan was
conducted through several Railways TO
Judge Wallaces private chambers. whence
he made his way out of the building. All
this was necessary to get away from
number of photographers. who were wait
ing in one Of the Railways TO take the
finaciers picture as he left the examination.
S7sOOO.OOO INVOLVED.
In reply 10 the first question put by Mr..
Lamb Mr.. Morgan said il was the business
of the firm of ]. p. Morgan & Co. to take up
anything in a financial line that was credit
able and which might suggest itself as prof
table The firm had much 10 do with the
reorganization Of the Northern Pacific in
1896. The amount involved in that reorgani-
zation was something like $7S0O0.Oo0.
Mr.. Lamb next asked Mr. Morgan I'm re-
gard TO a transaction in which s26. 600 600
par value of Northern Pacific stock was
purchased for j. j. Hill and associates i'm
1896 The witness said he conducted the
negotiation for that amount He did not
know whether all the purchasers OF that
block OF Northern Pacific stocks were Great
Northern people. Mr.. Morgan said he did
not remember all the details of the trans
action
"Of couse. it is a great transaction. and
it is only natural that you might not be
able TO remember" said Mr.. Lamb.
1T did not look very large 10 me-" said
the witness. The amount OF cash involved
was not more than about s.. COO COO
IF the Northern Pacific wanted anything
to-day IL would be financed by your house,
would il, not?" asked Mr.. Lamb
Yes, undoubtedly"
Has your firm loaned the Northern Pa
cihc any money!
Yes"
ION whose accounts have these loans
''That I won't answer. We were commits
stoned 10 raise the money. We got IL wher-
ever we could: From whom 1t was got
will not say.
AN EASTERN OUTLET NECESSARY.
Mr.. Morgan said the Northern Pacific
had not been controlled by any other rail-
road since 1896 Since that time it's value
had steadily increased. The Great North
ern, TO a certain extent. was a competitor
OF the Northern Pacific. J. =. Morgan &
CO. received no commission for financing
~
ferred. Concerning the Burlington purchase
the witness said he had made UP his mind
that Northern Pacific ought 10 have an
eastern terminal in Chicago. He talked
the matter over with all the persons inter-
ested and they agreed. He said there were
three lines available. the Wisconsin Gen.
tral. the Burlington and the ST Paul The
first, he said, he would not have
Il wanted the 81. Paul. said Mr. Nor
gan. ''and Hill wanted the Burlington.
and finally the Burlington was selected. IL
was the chief desire Of Mr. Hill that the
Great Northern should have terminal
Northern Pacific. There was nothing Sc
cret at all about the operation. Mr.. Hin
made the negotiations The price Of 500
a share for the Burlington stock was de-
manded by the Burlington directors and I
told Mr.. Hin by all means take H.
Mr.. Morgan was asked what the basis
OF valuation OF the stock was. and replied
that the stock was worth that amount for
the purposes for which IL was wanted
Did YOU know that there was a compe-
tition between Northern Pacific and the
Great Northern for the business OF the
Burlington
Il never knew two railroads that did not
compete" the financier replied.
AT the present time the Burlington is
operated Jointly by the Northern Pacific
and the Great Northern railroads." asked
Mr. Lemb.
Nothing OF the kind. The Burlington is
operated as Independently OF all other roads
as any railroad in the country"