The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1911-07-28
IT DID NOT COST CENT
L. c. Hanna Testifes Regarding the
Tennessee Coal & Iron Deal.

New York. July 2S-That the financ-
ing of the Tennessee Coal & Iron com
pany syndicate in 1905 did not cost as
much as a postage stamp" was the
declaration made today by L. c. Hanna
of Cleveland, O., a brother of the late
Mark Hanna. before the Stanley steel
trust investigating committee. Mr..
Hanna, who was a manager of that
syndicate before the company was alb
sorbed by the United States Steel cor
pOratiCn in 1907, also testified that the
main purpose of the men who took over
the Tennessee company in competition
with the steel corporation was to de-
velop the great mineral resources rath-
er than the mechanical equipment of
the property.
Tn the organization of that syndi-
cate Mr.. Stanley asked, did you en-
ploy Mr.. Morgan or any other financial
syndicate to float your bonds?"
THE financing of the Tennessee
company did not cost as much as the
price of a postage stamp" Mr.. Hanna
said. There were no bankers en-
ployed.''
Did you ever get an order for steel
rails from Mr.. Hartmann" asked the
chairman.
Yes Mr.. Hanna replied. Mr. Har-
riman gave us an order for 157, 500 tons
of steel rails"
How long was it after Hartman
gave you this ORDER asked Mr.. Stan
| ley, "till you learned that your COM
parry was in trouble in Wall street r.
Il don't remember exactly, but think
| it was several months
| When Mr. Hanna took the stand he
! was questioned first to his expert
| knowledge of raw material in the iron
| and steel business. He stated he had
| been connected with the firm of M. A.
Hanna & Company all his life, identi-
I iad n in pIr
in Ohio and Pennsylvania and later
with the Tennessee Coal & Iron COM
pany.
Syndicate Formed in 1905.
The Tennessee Coal & Iron syndi-
cate was formed, he thought, about
November: 1905. In the original p ddo
chase of its stock he had 10000
shares. As to the value of the Ten
nessee property, Mr.. Hanna said:
1T was well known that the Ten
nesSee company owned large amount
of mineral, iron and coal and flux
stone and the values of ore have
greatly increased in the last 10 years.
That advance, the witness attribut-
ed to the greatly increased consump-
Ition of iron and steel, the growing eX-
port trade and the increase of trans
lportation facilities.
Mr.. Hanna said he did not expect tc
become a competitor of the steel cor
poration north of the Ohio river.
South of the Ohio river we had {
good trade and expected to increase
The witness then described how the
stock of the syndicate had been placed
! in the hands of the managers with al
agreement that it should not be SOLE
below par, the agreement which Jno
w. Gates explained to the COMMITTEES
some time before.
WAS the purpose of that agree
ment placing the stock in the hand
of yourself and Moore and Schley, t.
4 make the sale easier or to proven
it?'' asked Mr.. Stanley.
The purpose was to prevent it ant
there never was any official effor
= made to dispose of the stock until tn
] panic of 1907"
e At the time of the sale Mr.. Ham
n said there was $4,000 shares of Ten
/ nessee stock. He was asked abou
= the financial condition of the chic
r members of the syndicate at the tim
S of the sale and said they were all re
e garded as financially sound
n When did you first learn that tn
< syndicate was in danger of losing con
troll of the Tennessee company"
= "On Sunday morning before tn
4 sale, Mr.. Schley called me on the tel
# ephone"
L The witness described how bank
4 holding considerable Tennessee collat
eral were in trouble and were demand
j, ing additional collateral. He describe
: in Wall street as peg stock becaus
it was controlled by a syndicate an
tied up for fixed period. It's nomins
value was about 120 to $50.
To Check the Panic.
At the time of the sale of the Tennes
j. see to the United States Steel corpora
Il ton Mr.. Hanna declared that the com
Il pany was in good financial conditio
{ and did not need to sell but that tn
= sale was necessary to avoid the fallur
T of Moore & Schley and the threatene
+ spread of a ruinous panic
& The whole financial situation
e New York was acute" said Mr. Hanna
T and the fear among the wisest final
}, ciers was that It would grow worse an
u pass beyond the control of men.
# In the transfer. the witness admltte'
1, not a dollar changed hands, the trans
+ action being executed by the exchane
l. of stock The effect of the transfer,
l. felt assured, saved the day and was tt
Il turning point for the better in II
panic. Details of the sale as fully de
scribed previously during the inquli
were repeated by Mr. Hanna at SON
L length. A former loan of 100000 b
lie the United States Steel corporation
ir Grant B. Schley also was reviewed
t During the hearing Norman B. Rean
1t ! director of the United States Ste