The Minneapolis journal. [volume] (Minneapolis, Minn.) 1888-1939, 1905-12-01
MORGAN BUNCOED
In c. Il. & D. DEAL
AL Wall Street Is Laughing at the
King of Corporation
Experts.
journal Special Service.

Journal Specia1 service. 49,. |
New York, Dec. 1;-Wall st; street :: ~, is
nent fnancier,'' the "king of corpora
ton experts,'' who has made life
study of railroads, for the way IN
which he was fooled into buying the Gin
cinnati. Hamilton & Dayton system az
high price, and then turning II over 10
It is said the Vanderbilt and Harri-
man interests in Erie brought about the
resale to Mr.. Morgan.
According. to Wall street, MI IT, Nor NOR
cinnati, Hamilton 3 Dayton, was led
- The Blind Traps. |
That the financial statements made to |
Mr.. Morgan were at variance with the !
books of the Cincinnati. Hamilton &
Dayton system.
That the allied system has a floating
debt of $6,S00,00O for rails and other
purchases of material, of which no men
tion was made in the statement to Mr..
Morgan.
That valuable rights were given to
the Detroit, Toledo g. Ironton for track
age facilities at Detroit and Toledo. alb
solutely without consideration, conceal
ment of which was made in the transfer
of the property to Mr.. Morgan.
That contracts of similar character,
giving valuable rights to the Detroit,
Toledo & Ironton were entered into at
the tine of the transfer of the Cincin-
natl, Hamilton & Dayton to Mr.. Morgan
without the knowledge of Mr.. Morgan.
The statement was made today by in
terests allied with Erie. that these con-
tracts were actually drawn after the
transfer and antedated.
That it has been discovered since Mr.
Hamilton & Dayton, that that system
has no rights over the new bridge
across the Ohio river, which the De-
troit, Toleda & Ironton is building at
Irontor, Ohio, which will give it en-
trance into the coal fields Of Kentucky
1t was at the time of the purchase that
this bridge was to be one Of the best
assets of the Cincinnati, Hamilton &
DAYTON in that the Cincinnati, Hamilton
& Dayton was to enjoy equal rights
with the Detroit. Toledo & Ironton over
it.
What Underwood Learned.
All these charges are the outgrowth
which President Underwood and his
vice presidents recently made in per
son of the physical and financial con
dition Of the Cincinnati, Hamilton 6
Dayton property.
It had further been discovered, as al
legged, that the Cincinnati, Hamilton &
Dayton has failed to meet it's fxet
charges for the current year by nearly
$l,OO0,00O. The road recently ISSUED
$4,000 900 of bonds to pay off an issu.
Of $2,5Oo,ooo, which matured in Octo
Der.
All of these allegations were commun
icated to Mr.. Morgan, it is said. OF
Nov. - by President Underwood, ant
were received with great surprise. Mr.
Morgan held conference with his as
soeiates and he then determined to take
back the Cincinnati, Hamilton & Day
ton from the Erie.
Roads Future Uncertain.
The future Of the Cincinnati, Hamil
ton & Dayton railroad is now. uncer
tain. The property has a certaingvalut
to nearly all. of the trunk lines tina
cross the Ohio valley. It is believed
Mr.. Morgan IS first step will be to ri'
the system Of the contracts which hav
been saddled upon it. 49,.
1t is said that when a syndicate I'm
dertook to merge the CINCINNATI, Hami
ton & Dayton. the Pere Marquette an
the Chicago, Cincinnati & Louisville, i
1904, they got $7,O00,0OO loan from
New York bank for which they pledge
all their holdings in Cincinnati, Hami
ton & Dayton stock. The loan bein
ures in August last. the syndicate wer
to J. P. Morgan & Co., and obtained M
Morgan s Endorsement.
When the note fell due, according
this story, 1t was said Mr.. Morgan WI
compelled to take over the property
save himself as we'll as to prevent tt
Gates Hawley interests from gettir
control Of it.
Zimmerman Got Control.
Mr.. Zimmerman got control Of the D
troit, Toledo & Iron'ton about the tin
that the Cincinnati, Hamilton & Da
ton was sold to Mr.. Morgan. He T
tired from the presidency Of the Cinci
natl, Hamilton & Dayton to becor
president Of the Detroit, Toledo & Iro
ton, the value of which property W
greatly enhanced by the contracts
holds with the Cincinnati, Hamilton
Datyon.
On Wednesday, Mr.. Morgan sent I
check to the Erie for little more tn
$10,O00,O00 to buy back the Cincinna
Hamilton & Dayton shares.
1t is believed the Cincinnati, Ham
ton & Dayton will ultimately be app
toned among the various trunk lir
centering in the Ohio valley. Amo
these are Lake Shore, Nickel Plate, t
Big Four system and Erie.
S2,l55,OO0 AS COST OF