The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1902-06-15
GENIUS SHOWN
How They Meet and Overcome Our
Natural Advantages.
CONSOLIDATION THE POWER EMPLOYED
Thus Argue the Merger Advocates, and Pro-
pose to Fight New England With Its
Own Weapon. The Freis and
Underwood Plans.

Specldl 10 the news anu ODSeTNei.J
Greensboro, N. c., June 14.-There has
been for some weeks most interesting
rival syadicates to obtain control of the
Southern yarn cotton milling interests.
In November of last year, Mr. Fl. E.
Fries, a large capitalist of Winston
Salem. this State, and largely interested
in corporate property, such as banking,
electric street railway, light ami power
properties, and one of the largest own
ers cotton and wooden mill properties
in North Carolina and Virginia coucciI CO
a plan ty which the immense waste in
separate administration of individual
properties of the numerous cotton mills
of the South, with it's conglomerate cost
of individual freight. fuel sale and out
put expense added, might be
avoided. In conjunction with other
large mill owners and capitalists
of the South and strong financial back
ing and support from New York and
Boston parties, he set about arranging
a deal whereby all these properties could
be merged in common administrative
anu cApChoC pun 81 luttb Il
intimidation of cost in all departments
could be effected. The reasons for this
merger or consolidation are trite in the
business world as to other properties,
but in this instance will be found in
teresting to New England mill interests
Briefly told the argument is sound
cogeDt and convincing to Southern. mill
men, sAs foliows:& Several years ago
Southern mills were making great
profit on the investment, so much so that
new mills were constantly being built
out of dividends from old ones. The New
England mills were said to be suffering
from the effort to compete with the out
put of these mills which had cheaper
labor, longer hours, better climate,
cheaper fuel, freights, salary accounts
and ADMIN ,rative pay rolls. For the
past two years, however. it has been
discovered that for some cause. with all
of these disadvantages the New England
spinners have reversed the conditions
and are giving the Southern properties
a life and death struggle. Investigation
showed that the New England genius
which always masters trade conditions
when put to the test, had devised a COM
munity of interest plan whereby savings
effected in other respects more than
balanced the natural advantages which
the Southern mills had in regard to the
cheaper rates of labor, ETC. The Fries
merger means nothing more nor less
than a legitimate effort by means of a
like consolidation and community of
ownership and control of Southern yarn
spinning properties to again give them
hn a6x faryo SHf
economics and methods as their Eastern
brethren, with the old advantage restored
of better natural conditions of labor, ex-
pense of raw material, contiguity to pro-
duet, climate, ETC., thus shifting the bur
den of competition from their shoulders
on to those of the East again.
1t is learned that in the contamination
of this deal. the promoters have been
compelled to buy several properties out
right, but that in most instances the
merger scheme, with pooling of part
stock, reissue of other, and substitution
of common stock, etc. has been emf
nently successful. with most of the mills,
whose cooperation has been considered
necessary of indispensable to the success
of the movement.
1t is an immense undertaking. but it
is reliably stated that its fruition is
absolutely essential to the continuation
of successful operation by most of the
solvent Southern mills. and the an
nouncement of its perfection may be eX-
pected any day. Prominent in the ad-
vancement of the enterprise are Messrs
Fries Brothers, of Winston Salem; A.
W. Haywood and DR.. Laird, large millers
of Haw River; j. H. Holt, of the Bur-
lington mills, and other owners of the
largest mill properties in Georgia, South
Carolina, Alabama and Virginia. Other
interested parties are Attorneys F. L.
Fuller and Clement Manly, of North
Carolina; w. w. Fuller. of New York
general counsel of the American Tobacco
Company, and George Cortelyou, E. G.
Hines and e. B. Walters, of New York;
E. S. Strudwick, of Richmond, Va, and
other financiers. There was a conference
here between some of these parties to-
day, Mr.. Fries having returned from
New York, but no definite information
has been given out, this party being
strictly business and keeping out of print
until something tangible and complete
has been accomplished and the aast link
welded that makes the great movement
a legal and actual verify.
Another merger scheme was COM
menced in competition with the Fries
plan, above detailed, by F. l.. Underwood
a successful New York promoter, who
in conjunction with Leonard Paulson, of