The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1903-01-16
NORTHERN SECURITIES INQUIRY.
George F. Baker Testifies as to His
Stock Hoidinos

NEW YORK, Jan. 15. - Testimony
taken here since Tuesday last in the
hearing incident to the suit brought in
Minnesota to test the validity of the
merger of the Northern Pacific and
Great Northern railroads in the North
ern Securities company, was made
public today. The principal New York
witnesses already examined are George
Il. Baker, president of the First Ma
uonal bank, and Samuel Thorn, both
large stockholders in the merged cor
poratons, and members of the board
OF directors of the Northern Securities
company.
Mr.. Baker testified that during 1901
ne owned stock of the Great Northern,
Which he held for five years. He had
been for some years the owner of sew
eraI thousand shares of the common
stock of the Northern Pacific. He ad-
m1tted that he was regarded as one
OF the coterie of Great Northern stock
holders, which included President Hill,
John S. Kennedy, D. Willis James and
others, who habitually co-operated
with Mr.. Hill in voting their stocks.
He, said he first heard of the purpose of
forming the Northern Securities COM
pany about thirty days prior to it's for
nation from President Hill.
He also admitted that he and Mr..
Hill had discussed the subject on sew
eral occasions, but he could not re-
member what was said between them.
He alluded to the effort that had been
made in May by the Union Pacific in
terest to get control of the Northern
Pacific and finally admitted that he
and Mr.. Hills other associates felt
that they wanted to get the Northern
Pacific and Great Northern stocks
placed with some company where the
control would remain permanently and
where these stocks could not be at
tackled by adverse interests. His con-
ferences with Mr.. Hill were along
these lines, and it was expected that
the formation of the Northern Sc
curities as the holding company would
accomplish that end.
Mr.. Baker, asked If he assented to
the formation of such a company, re-
piled: We'll. I made no objection"
So far as he was concerned, Mr..
Baker said, he understood the pur-
pose of the formation Of the Northern
Securities company to be that the
coterie of stockholders which had al
ways been able to control the Great
Northern should SO intrench itself as
to be able permanently to control not
only the Great Northern, but also,
through the majority of the common
stock, to control the Northern Pacific,
The witness transferred his Great
Northern and Northern Pacific stock
to the Securities company soon after
it's formation, Nov 10, 1901. The trans
fer was on the basis of $3.50 for the
Great Northern and $115 for the
Northern Pacific shares.
Mr.. Baker conceded that these topics
had been discussed when he and John
S. Kennedy and Mr.. James and others
of the so-called coterie Of stockholders
were present but when asked to re-
peat what he or the other gentlemen
said on those occasions he replied: II
don't think we did much Of the talk
ing; we were listeners"
Under cross examination the witness
explained that the formation of some
company to hold something like 3d.
600, 600 of Great Northern stock, owned
by Mr.. Hill, himself and the seven or
eight associates referred to, had been
talked of years ago. His purpose In
transferring his Great Northern and
Northern Pacific stock to the Securi-
| ties company, he said, was to make
those stocks more valuable or to pre-
vent foreign interests from getting
control, and diverting the business of
the Northwest down to California. On
direct examination it was brought out
that what Mr. Baker called the sale of
his shares to the Northern Securities
company was in reality only their eX-
change for shares of that company
stock at fixed ratio.
When Samuel Thorn, another di-
rector of the Northern Securities COM
pany, took the stand he admitted the
ownership for years of some $4,000
shares of Great Northern stock. He
said that he also owned Northern Pa
cific stock, which he bought from j. p.
Morgan, in 1897, and that he acquired
about 5000 additional shares Of North
ern Pacific common from ]. P. Nor
gan, in 1901. Mr.. Thorn made admis-
sions substantially similar to those
made by Mr.. Baker. 1t was brought
out that While President George F.
Baker, of the First National bank, is
a director of the Northern Securities
company, his son, George F. Baker Jr.,
figured as one of its incorporators.