The Minneapolis journal., 1903-01-16
M0RGAN'S TESTIMONY
He Tells Why Southern Did Not
Buy Louisville & Nashville.

Buy Louisville & Nashville.
s,s New York, Jan. 16.--At the hearing be-
fore the interstate commerce commission
President Elliott of the Atlantic Coast
Line company, and counsel Of the same,
said: I'VE bought the controlling stock
Of the Louisville & Nashville just as YOU
buy box of candy. It was wrapped up
and delivered to us, and we paid $50 0,0o0,-
900 fer it,
( j. Pierpont Morgan said he was the
head of his firm and that the firm had ten
or twelve members. He had nothing to
do with the purchase of the 306, 900 shares
except to approve the contract when
made, The deal was explained to him by
Messrs. Perkins and Steele, when he re-
turned from Europe last spring Mr.. Nor
gan presumed a conference was held with
Mr.. Gates about the Louisville &. Nash
vile stock sale, but he was not present.
He was never a director Of the Southern,
but thought his partner, Steele, was. Mr..
Morgan could not remember the prelimin-
aries Of the Monon purchase, though he
might have known all about them at4the
time. A sentence in circular sent out
by Morgan & Co. Aug. q, 1902. was men
toned to the witness. 1t advised stock
holders of the Southern to make no change
IN the management until after the set
tlement Of certain matters which might
affect the development Of their lines.
We were trying said Mr.. Morgan in
explanation, Ito prevent any one getting
hold Of the stock like they got hold OF
louisville g. Nashville and knocking it into
a cooked hat III $500 ~
I Witness considered it important to the
Southern to hold together the Louisville
& Nashville. The option on the Gates
stock was got April l5, and he did not
know in August who would buyit. ''Mr
Gates had the stock" said Mr. Morgan,
stor, ofo1 e.
No one knew what he was doing. took
the stock away from Gates and put it
where It would not hurt the Southern.
At the time we sold it we held for
others.
Let, me tell you the story. We found
that Mr., Gates and his associates had
control OF the Louisville g. Nashville
When Gates came to us we found he had
control of 900 Of the shares. b..
''That gave him control. The Northern
Pacific experience Of the year before made
us aware of the danger to the Southern
stock, and so we made arrangements with
Gates. I knew the sale to the Atlantic
Coast railroad would not be disturbing
element to the railroads Of the south
Mr.. Morgan said at one time he came
near returning the Louisville & Nashville
stock to "Gates and the others
Continuing, the witness said his inter-
est in the whole transaction was merely
as banker. He denied that the South
ern had anything to do with the purchase
or sale of the Louisville e. Nashville stock.
His desire was for the maintenance at the
general business situation In the south.
and he deemed it unwise that the stock OF
the Louisville & Nashville, which was
for sale, should be at the mercy of stock
speculating firms" ~ liz.
did you recommend the Southern rail.
road to srecure the Louisville & Nashville
stdck?" asked Commissioner Prouty. -
why, SIR Mr.. Morgan said, ''they
could not hold it. They parallel and are
competing lines" Mr.. Morgan said he did
not believe that any one interest owns as
much as s. per cent Of the stock Of the
Southern railway.