Evening star. [volume] (Washington, D.C.) 1854-1972, 1906-08-24
RYAN BLOCKED IN MERGER.
Failed in Plan to Consolidate Trust
Companies.

bAcO IL 34an u SOuSOA1OaSo xTUSC
Companies.
Thomas F. Ryan. before he went to Eu-
rope, tried unsuccessfully to consummate
a gigantic scheme for the consolidation
under his own dominating influence Of the
four great trust companies controlled re-
spectively by the Equitable Life Assur-
ance Society and the Mutual Life Insur-
ance Company.
These subsidiary companies are the
Guaranty Trust Company and the United
States Mortgage and Trust Company. con-
trolled by the Mutual Life. and the Equita-
BILE Trust Company and the Mercantile
Trust Company. controlled by the Equita-
Bile. On competent authority 1t was learned
yesterday that Mr.. Paul D. Cravath, Mr..
Ryan's personal counsel. acting under Mr..
Ryan's instructions, drew up in outline q
a plan for the consj cdatiOn OF the COM
psnies named, under the fostering wing of
the Morton Trust Company. an institution
Is the vice president.
As the owner of the majority stock in
terest in the Equitable Life Mr.. Ryan could
readily have swung into such a deal the
Equitable LIES holdings in the Mercantile
Trust Company. amounting to IS per cent
OF that concerns entire capital stock. This
holding had market value on January Of
last year of about $12.S0oOOO. He could
stock holding in the Equitable Trust Com
pany. amounting to about so per cent of that
trust company's capitalization. with mar
ket value of about $S,SOO.OOO
To acquire control of the trust companies
subsidiary to the Mutual Life was not so
easy. and the scheme failed. The Mutual
Life had 10, 1876 shares of the stock of the
United States Mortgage and Trust Com
pany. held at a market value Of "a .294. 400.
and seas shares of the Guaranty Trust
Company's stock. worth 81, 756. 400.
Under the terms Of the Armstrong insur-
ance laws the life insurance companies
in these subsidiary institutions and of all
other stocks within period OF five years.
In that necessity Mr.. Ryan saw an oppor-
tunity for a characteristic stroke Of high
finance.
These companies have been immensely
profitable. According to the Equitable Life s
report to the Armstrong committee, its
Mercantile Trust stock paid an annual div
tdend Of 80 per cent. Its book value was
$434, and Its market price $500. The Equit-
able Trust paid an annual 10 per cent div
idend. The Guaranty Trust Company and
the United States Mortgage and Trust
Company each was paying 20 per cent
annual dividend in 1905 Acquired by the
Mutual Life at a cost price of less than
$147, its Guaranty Trust Company stock
had a market value of $3.50. while its
United States Mortgage and Trust hold
ings. acquired at $135.1O, had a market
price of $500.
Mr.. Ryan had not been without influence
in the affairs Of the Mutual Life. The
Mutual held 1000 shares in Mr.. Ryans
Morton Trust Company, representing q
value of 81. 100000. In the Mutual LIES
board Of trustees were men Distinctly
friendly to the Ryan interests. and several.
including George G. Haven. who also sat
in the directorates Of such distinctively
Ryan institutions as the Washington Lifs
Insurance Company or the Morton Trust.
When Thomas F. Ryan and Levi P. Morton
acquired control Of the Washington Life
Mr.. Ryan. with the consent and good will
Of the old McCurdy administration Of the
Mutual, placed in the presidency of the
Washington Life John TatlOck, trusted
officer Of the Mutual.
When It came to formal proposal to
swallow the Mutual's two big trust cOmpa-
MES, however, and consolidate them with
his own into gigantic institution. with
the Morton trust its nucleus. the Mu-
tual Life baked at MIR. Ryan's plan and
the matter went no further than Mr. Cra-
vath's submission Of a skeleton proposal
of terms.
Mr.. Ryan also hoped to control the dis
posal of the Mutual LIES large holdings
in the stock of the National Bank Of Com
merce, which must also be unloaded under
the terms of the reform insurance laws.
unless those laws be modified within the
next five years. The Equitable Life has
JO,231 shares Of that security, worth $1O.-
1269OO on January 1. 1905. That Is about
20 per cent Of the banks capita stock. The
Mutual Life holds 36.08S shares. worth
S727 GOO year ago.