The Daily Missoulian. [volume] (Missoula, Mont.) 1904-1961, 1909-01-30
SENATE COMMITTEE INVEST.
GATES ABSORPTION OF TEN.
NEssEE COAL COMPANY.
PERKINS IS QUESTIONED
Company Is Quizxed by Senator
Culberson Regarding Consolidation
Which President Roosevelt Ap-
proved--Other Witnesses.

| washington Jan IS--l ne merger OF
| the Tennessee Coal & Iron company
and the United States Steel corpora
| ton was investigated by the senate
committee on the judiciary today. The
witnesses were Oakleigh Thorne, pres
| ident of the Trust Company of Amer
lea. and George w. Perkins of j. p
| Morgan 4 Co, which Is also a mem
| Der of the finance committee Of the
steel corporation.
| No efforts have been made by the
committee to subpoena Judge Gary
and Henry c. Frick.
The examination of both witnesses
today was conducted by Senator Gull
berson.
Mr.. Thorne testified that the Trust
Company of America has no interest
| In the stock of the Tennessee Coal 4
Iron company as owner but on No
vember /, 1907, it had loaned $4s2,-
| 700 to six individuals holding the stock
| as collateral.
| All of these loans, said Mr.. Thorne,
were paid off in November with the
exception Of two of s52. 900 each.
| Mr.. Thorne said that he considered
|
and that his company had no interest
| in the absorption of the Tennessee
company by the steel corporation and
| did not know Of the negotiations, un-
| til after they were begun.
| Senator Culberson then inquired of
Mr.. Thorne where he had knowledge
OF a syndicate which owned the con-
trolling interest in the Tennessee Coal
| q IN, ta 60 of
| He replied that he had and that he
| was a member of that syndicate. but
he had withdrawn from the syndicate
and was not familiar with the syndi-
Gates operations. The original syndi-
cate managers We're given as Grant b
Schley and Charles Guthrie
| Leonard Parma of Cleveland took
| the place of Mr. Guthrie after the lat
| ter's death This syndicate. declared
| Mr. Thorne, owned majority of the
| stock of the Tennessee company.
| In addition Mr.. Thorne mentioned
John w. Gates, e. J. Berwin and Fl.
S. Black. When asked IL he had any
personal knowledge Of the actual sale
of a majority of the stock of the Ten.
nessee company In November, 1907,
Mr.. Thorne replied:
| Got Receipt.
IAN that know is that I delivered
my stock to ]. p. Morgan & Co, and
| got receipt for It,"
Senator Overman asked Mr.. Thorne
| II, at the time of the merger, the
Trust Company of America was finan-
| cially embarrassed and II SO, whether
the merger had tendency to relieve
t,nl
bearing on either himself or the COM
| pany.
| At the time the syndicate. to con-
| troll the Tennessee Coal & Iron COM
pany was formed, said Mr. Thorne, the
syndicate price was $110 a share, but
its market price was $s5 and 1t went
up to 1928.
Mr.. Thorne testified that when the
Tennessee company stock was sur
rendered the owners received In return
United States Steel per cent
| bonds on the basis of $119 par value
| for each share OF the stock Of the
| Tennessee company. The steel cor
poration bonds were quoted by Mr..
| Thorne as being worth from sS2 to
$s4 at the time he received them and
being worth now between $1o2 and
s103
| Perkins Testifies.
| When Mr.. Perkins took the stand
| he said:
"The acquisition of the Tennessee
| Coal & Iron company by the United
! States Steel corporation was never
brought up or broached in any way
| as far as my knowledge goes, until
| perhaps the second or third acute
stage of the panic developed in New
York and then 1t came up very sud
| denly because of the series Of dis
turbances that existed In New York
as a result of the great depreciation In
market values and the unmarketabil-
ity of great many securities"
| Mr.. Perkins said that there was a
| general feeling which it would be diff
| ficult for anyone to express in a
concrete statement, that If the Tennes-
see Coal & Iron company stocks were
| taken out at various loans, in some
way it would prevent a great many
| failures and avert spread of the
| panic. Continuing, he said:
| Finally. some one made a sugges-
| ton which afterwards worked out that
| the corporation might furnish 5 per
| cent second mortgage bonds in lieu
| of cash and in this way put in lieu of
| these loans securities that were mar
ketable.'
| Mr. Perkins told of the visit to
| Washington of Judge f. H. Gary and
| Henry C. Frick for the purpose of
seeing the president.
Practically everything was at
standstill until we got word from
| Washington as to what seemed to be
the feeling there" continued Mr. Per-
lsins.
Gary Phoned.
THAT was telephoned to me by
Judge Gary on Monday, about the