The Montgomery advertiser., 1909-01-30
MONEY KINGS ON THE STAND Senator's Probe the Steel Merger, CALLS PERKINS AND THoRNE culberscp Asks Pointed Questions e of Capitalists. comni.see may c.n Judge Cary ana H. c. Friek--steel Ne. Think Hs.e-
 veit DIs sAe Right
 Thiss.
CALLS PERKINS AND THoREE.

-Washtn8Lon, Jan. zb.--The merger oi the Tennessee Coal and Iron Company
 and the United States Steel Corpora.
 ton was probed by the Senate commit.
 tee on judiciary today. two New Yorl bankers being examined in an execu.
 tive hearing that continued through two long sessions.
 The witnesses were Oakleigh Thorne president of the Trust Company of Am erica and George W. Perkins. of J. P Morgan aud Company. who Is also . member of the finance board Of the steel corporation.
 The testimony of Mir. Perkins seem. ed to uphold President Roosevelt's con tention that the absorption of tho Ten- nessse concern was necessary to res lisve the panicky condition of sscuri- ties fin November. 1e0T
 Mir. Thorne denied that the Trust Company of America was interested in the deal in Tennessee Coal and Iron
 stocks and declared the merger was moi
 necessary to save his institution. He gave the names of many of the per
 sons who were interested in the syn dicate, which obtained control of a ma.
 1ority of tfie Tenneessee stock. No decision has been reached by the
 committee to subpoena Judge E. H Gray and Henry c. Prick.
 The examination of both witnesses
 was ronducted by Senator Culberson. It was conducted by Senator Gull person.
 Thorne on stand
 Mir. Thorne, who first took the stand. testified that the Trust Company of l.Arnerica had no interest in the stock lsof the Tennessee Coal and Iron Com- pany, as owner, but that on November I1,sis07, 1t had loaned ssS2.7GG to six | Endividuals, holding the stock at six | ty, as collateral. All of these loans. said Mir, Thorne. were paid off in No- vember with the exception of two of
 NIT. Thorne said that he considered the security for the loans to be abun- dantIy good and that his company
 had n0 interest whatever in the ab- sorption of the Tennessee Company by
 the Steel Corporation and did not
 know of the negotiations until after it
 was begun.
 Senator Culberson inquired of Mir.
 Thorne whether he had knowledge of q syndicate which owned the control- ling interest in the Tennessee Coal and Iron Company. in the fall of 1907.
 He replied that he had and was a
 member of that syndicate, but that he had bought his stock and withdrawn
 1t from the syndicate and therefore
 was not familiar with the syndicate's operations. The names of the origin al syndicate managers were given as
 Grant B. schley and Charles Guthrie. Leonard Hanna. of Cleveland, took the hlaca of Mir. Guthrie after his death.
 This syndicate. declared Mfr Thorn.
 owned a majority of the stock of the Tennessee Company, Tn addition to
 naming Msssrs. Schleys Guthrie and
 Hanna as being interested in the sym
 dicate, Mfr. Thorne mentioned John W :. vaA on1r
 Senator overmRn asked Mir. Thorne. if, at the time of the merger, the
 Trust Company of America was finan- ciaily embarrassed. and, if 30. whether
 the. merger had tendency to relieve the embarrassment. In reply, he said
 that 1t had no direct bearing on either
 himself or the company. but as 1t as- sisted the general situation, naturally it assisted his institution. At the time,
 the syndicate to control the Tennessee Coal and Iron Company was formed. said Mir. Thorne,, the syndicate price was $110 share, but its market price was 9S. and 1t went up to 128. Mir Thorne testified that when the Tennessee Company.s stock was sur | turn, United States Steel five per cent bonds .on the basis of 11s par
 value for each share of the stock of | the Tennessee Company. The steel l corporation bonds wer quoted by Mir
 Thorne as being worth sR o.YS4 at the time he received them and being worth
 now between s1O2s and 10s. = v :. r. y ; PeFEktna Talks of Deal.
 When Mi. Perk fms took the stand
 he was asked to state any Knowledge ! he had of the absortion of the Tennes- l see Company by the United States
 Steel Corporation, and he said: 1 sThe question of the acquisition of
 the Tennessee Coal and Iron Company by the Steel Corporation. was never brought hp or broached in any way,
 so far as my knowledge goes, uttil perhaps the second or third acute stage of the panic developed in New
 York. and then 1t came up very sud denlY ." ~
 MT. Perkins said there was a gen
 eral feeling which 1t would be difa- cult for any one to express in com crete statement that if the Tennessee l Coal and Iron stock was taken out of prevent, a great many failures and avert a further spread Of tie panic
 Continuing. he. said:
 "Of course at that time most every one in New York was using. their rec sources in every direction to aIIay the panic and some one made sugges- | ton that the steel corporation was the ! one itnAb IulBtlL loAAc lAtSse pdEttCuAAI
 securities and relieve that part of the situation. ."s ., "
 Steel Corporataon Meluctant. ,.Mr. Perkins said there was 6 great j deal of reluctance on the part of the
 Steel Corporation to take the Tennes- I see property. He said. the Steel Com. I pany considered the price very high ! and there might be U great deal of
 criticism as to their right to take the \ property Mir. Perkins told also of I inc visit to Washington of Judge E. H
 Gary and Henry c. Prick for the pur- pose of seeing the President.
 That practically everything was al | a stanastill until we got word from | Washington as.stop what seemed to be
 the feeling there" continued Mfr. Per
 kins.
 That was telephoned to me by Judge
 Gary about 10 o'eIocls on Monday, abou; I the tlEnSs the market opened, .afld the
 news that this transaction probably
 would be given out and had an instan-
 taneous effect for the betterment, and
 have always believed. stopped the panic. At any rate, from that time forth, matters rightedt themselves" 1 It was asserted. by Mir. Perkins thai l tn ere has never been any intention on
 the part of the Steel Corporation of
 acquiring the Tennessee Coal and Iron HCompany. He said the transaction
 was carried on with but one purpose lin view, namely, to allay the unsettled conditions that existed at that time. Effect of Exchange.
 Responding to questions by Chairman l Clark as to the effect of the, exehang- i ing Steel bonds for the stock of the
 Tennessee Company, Mir. Perkins said 1 "Whether or not the steel bonds were