New-York tribune., 1909-11-17
pJryS 4 SUBSTANTIAL
MINORITY INTEREST.
TeIephone and Telegraph To
Be Operated in
Harmony.


..,,,ss,s,ood that the Gould stock taken
,,,,r nv the telephone company repre-
,.,,s about o per cent Of the outstand-
sre ses $4,000 capital stock of the West
g, Trnion. The total authorized amount
a. which is sl25.Ooo.o0o. Acquisitions
from other sources. il is said. bring the
amount ~ western Union stock held by
the telephone company 10 about IS per
cent Of the total outstanding While this
does not give the telephone company
actual control the stock Of the Western
Tnivn company is so widely scattered,
there being about twenty thousand
stockholders, that for ali practical pur-
poses il gives the telephone company
TIE deciding voice IN the Western Unions
Fnsirs
Theodore y. Vail president Of the
American TelerhOne and Telegraph
Company. made the announcement early
in the afternoon that his company had
obtained control OF a substantial minor
ity interest in the shares Of the Western
Union comnany. but he did not say from
whom the stock aad been obtained. II
was Tho general opinicn in the financial
district however. that il was the Gould
holdings that had been acquired. and
later in the cay George ]. Gould issued
statement confirming the opinion.
GOULD SELLS HOLDINGS.
His statement vas as follows:
It is fact that We have sold 3 large
srt Of our holdings in the Western
Union Telegraph Company 10 the tele-
phone company. ] believe this will inu-e
- the benefit Of both the public and the
western Union stockholders as the bust
ness II both companies can be handled
- that they form a complement 10 each
other, thus giving 10 the fullest extent
prompt and satisfactory service 20 their
patrons. They should be worked in haT-
mcny. which vii be 10 the great ad-
Nsniagc a the public well the
mutual interests Il both companies.
The price the Goulds received for their
stock was not made public though in
unorhoial quarters Il was said 70 have
been around s. a share. The stock sold
= point higher than this on the Stock
Exchange yesterday. following the an
nounoement thst the Telephone Com
rsnv had bought large interest in the
company. but declined later in the day.
closing 81 s2ik. a net loss Of q point.
II was the belief in some quarters that
the acquisition Of control Of the Western
Union by the American Telephone and
Telegraph Company vas the first step
fcwsrd the formation % . huge tele-
phone and telegraph combination. which
would include. besides these two con-
Germs and their subsidiaries. the Postal
Telegraph-C bic Company and the Com
rneroisl Gable Company. These last
Two companies are controlled by the
Mscksv Compa nies. which holds 2 sub
stantial interest IN the American Tele-
phone and Telegraph COMPANY. and such
= combination. II was pointed out. was
TOT beyond rhe range of possibilities
NACKAY COMPANIES SILENT.
ohoers of the Maokay Compa MES de-
rlined 10 comment on the merger reports
v c. Clowry. president Of the Western
Union. when asked whether the pur-
chase by the Telephone company Of
substantial interest in the company
meant hnal control by the Mackay Com
psnes. said that he did not see why
that should have anything 70 do with in.
Such merger would mean q company
with capitalization of close 70 81. 600
oo".oot. The American Telephone and
Telegraph Company has total capital
izsti"n ~ mere than $500, ,00o.O 900 and the
Y estern Union company % sls5.OOO. 900.
snc the capitalization Of the Msckay
companies represents about 500. 600. 600
more, making total capitalization for
thsse three concerns Of close 10 $500
OGO 900
The announcement that the American
Telephone and Telegraph Company had
acquired pra @tical control Of the Western
lrion company did not surprise Wall
Sif+et As rumors that such a deal MAS
pending have been persistently circulated
f"r months. and although they were Off
c;tlly denied the action Of Westerr.
nioH stock was evidence enough to
Wall Street that negotiations Of some
k.nd were under Nay. when. several
weeks ago. the announcement was made
that the Western Union company had
sold 10 tho American Telephone com
psny its Sl6.O0O.000 Of New York Tele-
Thone stock the reports Of = merger Of
th- two concerns were revived. but they
again met with denial in official quarters.
REASON FOR ACQUISITION.
Tho reason for the ACQUISITION Of the
Gould holdings Of Western Union stock
hy thc telephone company WAS set forth
- follows by President Vail i'm his
statement announcing the purchase:
Prom the very commencement OF the
telephone business n has been thought
mat close corporation the making Of
one business the auxiliary 10 the other
business would give additional pfblir
service. - well as result in large econ
"nies both 10 the public and 10 the COM
psnies
There is much % be gained bv the
Joinf construction and maintenance Of
plant and by It's common use 10 The
Treafest possible extent. but the greatest
advantage would follow the t,lscinp ~
the millions 81 telephone suhscribers in
close and reliable connection win The
receiving snd disDatching Offices 81 the
telegraph comps nies While some rro-
vision for this after . manner eyists To-
DAY. . lack Of harmony and co-operstion
between the companies and an ina bilitv
20 agree on methods OF fixing responsi-
blity have limited its utilizs ton 10 cases
~ absolute necessity. The harmony and
cooperation necessary. n is believed. can
now he ests blished and the resulting
advantages made available for the
public.
Ielt grsrh companies and telephone