The Detroit times., 1911-04-15
COPPER MERGER
ECONOMY MOVE
Contention OF Calumet & Hecla Ma
jority in Meeting COMPETENT OF
Minority Stockholders.

The Friday morning session In the
case OF G. M. Hyams to prevent the
completion OF the amalgamation oil
the Calumet a. Hecla mining com
panies In the Lake Superior region
was taken up with the argument tor
the defendants by Attorney Allan r.
Rees, OF Houghton, Mich.
Mr.. Rees outlined the advantages
OF the proposed consolidation 10 the
mining properties involved. In cheap
ening production costs and effecting
big economies in the operation or
the mines. He also tok up the his
tory of the negotiations for the con
solidation and tse steps that were TAX
en- by the directors OF the companies
to secure an absolutely fair valuation
OF all the properties involved.
There are 10000 stockholders In
the various mines involved In this
merger" said Attorney Rees; and
II would have been impossible for the
directors who were making the nego-
tiations for the merger TO have con-
suited them all. In view OF this FAC:
il was deemed advisable that informa-
ton should be withheld from all the
stockholders SO that none should have
had any advantage over the rest, and
In order to prevent speculation In the
stocks OH partial or garbled informa-
ton"
The objection is made TO the con.
solidation that the speculative values
OF some Of the mines is not properly
estimated and II may be true that In
some instances stockholders will be
required to sacrifice possible specula-
tive profits for stability and dividends.
The arrangement was not framed,
however, for the stock Spectator but
for the investor"
Mr.. Rees went on to show that the
Hyams valuation OF the Osceola prop
erty was Sll,S40,605, according to the
statement in the bill, while the valua.
ton made for the purpose Of the mer-
ger was $12,0lS,750. The valuation Of
the Calumet 4 Hecla properties for
the purpose OF consolidation was $42..
l9S,362 and the only objection that Is
made by Hyams TO this valuation Is
the estimated value OF the conglomer-
ate sands which Is placed at 1920
900.
Exception was also taken by Mr..
Rees to the statement In the bill that
the ratio at which stock was to be
apportioned 10 Calumet q Hecla and
10 Osceola stockholders was unfair.
He stated that Calumet & Hecla stock
would be exchanged on basis OF IL
share OF the new for one share OF the
old. while Osceola stockholders got
one share of the new stock for two
shares of Osceola. Hyams claimed
that Calumet & Hecla got "a for one
but Mr.. Rees claims that the z extra
was allotted on account Of the Osceola
stock owned by the Calumet Hecla
company.
The case will be continued before
Judge Swan Friday afternoon and 1t
is not likely that the arguments will
be completed before Saturday as there
Is a great mass of material TO be gone
through with.
The chief question at issue is the
value Of the Calumet & Hecla con-
glomerate sands which are said to be
worth 100000 by the company. Mr..
Hyams claims that they are not worth
anything at all. In support OF Hyam's
contention affidavits were presented
showing that experiments In extract
ing copper from the sands had been
unsuccessful, while an affidavit made
by Harry Benedict, metallurgist In
charge Of the reduction OF the sands,
showed that couuer could be extract.
ed at a cost OF sos cents per pound
and that the sand-pile is worth $780,
100000
Another allegation OF Mr.. Hyam's
that the Calumet & Hecla officers had
kept the shareholder In the subsidiary
companies in the dark, was met by
the affidavit OF Quincy A. Shaw, pres
ident of the company, with the state
ment that the shareholders OF the 9TH
er companies knew as much about II
as the Calumet & Hecla shareholders
and that information was withheld
from all alike for the purpose Of pro-
venting stock speculation which would
follow IL partial information had been
given out from time to time.
Mr.. Hyams also alleged that Thomas
Chadbourn, a director of the AhE-s X
Mining Co., had resigned because he
had not been informed of Il course
OF the consolidation and against this
allegation Attorney Allan F. Rees, who
represents the Calumet q Hecla In.
terests presented letter from Mr.
Charbourn stating that the reason
F why he resigned was because he did
| not have time TO study the question
| SO as to be able to cast an intelligent
| vote.