The Virginia enterprise. [volume] (Virginia, St. Louis County, Minn.) 1893-19??, 1903-08-14

Mr.. Hill and the stockholders referred
likewise alarmed by such attempt in the
interest of the Union Pacific company TO
obtain control Of the Northern Pacific
and through it Of the Burlington, system,
injuriously affect the property Of the
Great Northern railroad, and the country
t tray rs by it and by the Northern Pa
tablishing a holding company to pur-
chase and hold majority Of the stock Of
the Northern Pacific company they joined
company and placing therein their own
stock in the Great Northern company and
permitting all other stockholders OF the
same company who might choose to do
likewise, and thus accomplish their pur-
pose above stated of giving permanency
to the management and policy of the
Great Northern company.
Not Done by Companies.
The incorporation Of the Northern fe-
curltles company under the general laws
q N SeS oo Jersey and With capital Of
NetSeg the saf Hov 49, 1901
the Northern Pacific company. by any
act. of its directors, or any corporate.
h nag ANYTHING to do with the formation or
curit1es company; but Mr.. Morgan Mr.
Hill and other stockholders OF the North
ern Pacific company. and Great Northern
ton OF the Northern Securities company
for !.r the purposes purposes abeve stated.
when formed sna
chase and to pay for in its own stock at
par ($1o0 per share) any stock Of the
Northern Pacific company at the price Of
ny tho p ri the Of
stock Of said two railroads We're at such
rates "a ts and 50 paid for. purchased from
Of said two railroad companies by said
Northern Securities company:
and his associates sold to J. P. Morgan
& Co. all the Northern Pacific company
stock which they had purchased as afore-
said-both common and preferred
sad n %o more Z Co. st the sa ana
time sold all the same stock to the North
ern Securities company who paid the
consideration therefor directly to Mr..
Hartman and his associates; a part of
such consideration being something more
than $S2,0o0,000 of the stock Of said
Northern Securities company. That pur-
ION Jan. l, 1902, the Northern Pacific
company ceaPy paid off and retired its preferred
stock, ha hy1 raised the money for that
into common stock of that company 9TH
er stockholders of each Of said two rail-
r9ad companies sold their stock to the
in payment or exchange therefor. at the
rates aforesaid. stock Of the last named
company company go that by Dec L. 1901. said
the. owner of considerable more than
majority of the stock Of the Northern
PACIFIC company, and large amount. but
less than majority Of the stock Of the
chases from stockholders continued. and
at the time OF the commencement Of this
suit the Northern Securities company had
- fnA 1< n1~~~+
So per cent Of all the stock Of the North
ern Pacific company and Of about IS per
cent of all the stock Of the Great North
ern company.
Conclusions Of Law.
'First-It IS obvious from the FORE
ging facts that the Northern Securities
company was Incorporated with the pur-
pose and intent on the part Of its pro-
mOters that it should acquire by purchase,
by exchange for Its stock, and should
own a1 ID ce o4tr considerable majority
company. and thus secure that company
against the danger of any future raid
upon its stock which might place it's man.
Burlington system in the power of any
rival railroad corporation, whose interests
might be hostile to the development and
property Of the Northern Pacific and
board terminals, and Of the region Of
country traversed by their railroad sys-
This was the avowed purpose of Mr..
Morgan and his associates who acted
with him in this matter, including Mr..
Hill and other large stockholders Of the
large amounts of stock in the Northern
Pacific company and were apprehensive
that any hostile control Of the Northern
its interests to rival. would be disass
trous to the development and prosperity
OF the Great Northern company. And at
the. very time when the Northern Sc
porated. by means Of the large holdings
Of Northern Pacific company stock by
himself and his associates acting with
Morgan & CO. Of the Hartman holding
Of such stock, said ]. p. Morgan was
able at once to transfer and have trans
ferred to the Northern Securities COM
pany large and controlling majority of
the stock Of the Northern Pacific COM
pany as was done; thereby accomplishing
las was bel1eved) the purpose Of securing
that stock against hostile raids in the
future.
No Purpose to Control.
Northern company the evidence sh, WIS
that when the Northern Securities com
pany was incorporated 1t was the purpose
and intent of Mr.. Hill and other large
pany who acted with him to sell and dis
pose Of to the Northern Securities COM
pany Tor its stock, their several held
ings Of stock In the Great Northern COM
pany aggregating then about $S5, 900, 900
to the end that such large amounts of
Great Northern company's stock should
be kept. together, and (as 1t was hoped)
aid in giving permanency to the manage
ment and policy which had controlled and
was controlling the railway and develop
ment of that company. And it was their
purpose that all other stockholders Of the
Great Northern company who might
! choose to do so should be permitted
to sell or exchange their stock of that
company for stock of the Northern Sc
curities company on the same terms; and
it was hoped and expected. that many
would do so. 49,. .t@s@ i 8
But the said Hill and his associates
| had no power or control which could en-
able them to transfer or cause to be
transferred to the Northern Securities
company SO much as one-fourth Of the
stock of the Great Northern company.
The evidence, therefore, fails to show
| that the Northern Securities company
was formed for the purpose of acquiring
and holding ma jority Of the stock of the
Great Northern company as well as that
| Of the Northern Pacific company. Az
though, that result followed soon after.
and may have been desired and antlci-
pated. IN. &, 81 !. -
State Anti Trust Law. 5@**S
g.. One question In this cause 4
whether the acquisition by the Northern
! IT, ,.