New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1912-09-26
SUGAR PROFITS HIDDEN
Letter from Head of Subsidiary
Read at Federal Suit.
w. F. HAVEMEYER ON STAND
Says Trust Is Capitalized at
$50,000,000, but Is Worth
Only $25,0C0,000.

The hearings in the governments disso-
luton suit against the American Sugar
Refining Company and other defendants
which were adjourned here in August
We're taken up again yesterday morning
before Special Examiner Wilson II. Brice
in the Federal Building. Following the
adjournment in August testimony was
taken i'm Denver Salt Lake City and othe.
| places in the West.
James X. Knapp. Assistant United
States Attorney, appeared for the gov
eminent and Frank Crawford acted as
the representative for the sugar com
pany.
The first witness was John Jurgensen,
the retired treasurer Of the Matthiessen
& Weichers Sugar Refining Company. He
testified that his concern became a part
OF the American Sugar Refining Company
in 1857 and that stock in the former COM
pany was exchanged for that Of the lat
ter concern. The witness said that Il
was his duty as treasurer 90 purchase the
raw material for the manufacture OF
sugar. which, he said, was done III compe-
tition with smaller concerns, the names
OF which no was unable TO recall.
Mr. Jurgensen admitted that lie was
unable TO tell any Of the particulars OF
the sale OF the Matthessen & Weichers
Refining Company TO the American Sugar
Refining Company, az, after 1877, he had
nothing 20 do with the executive admins
tration OF the concern. The final con
solidatlon OF the selling departments 81
the seventeen companies IN the American
Sugar Refining Company took place In
1889. and many OF the offices were trans
ferred to the Havemeyer Building The
witness told Mr.. Knapp that 1t was the
boast OF the company during the time
ne was connected with IL that 1t could
refine more sugar at lower cost than
any other sugar refining plant.
Mr.. Knapp, the governments attorneN
then introduced as evidence several let
ters. among them one written 20 w. y.
Thomas. the president OF The Americah
Sugar Refining Company. BY Chester ;.
1iorey. president OF the Great Sugar Re
fnng Company, with headquarters In Den
YER The letter was an explanation OF tho
income statement, and called Mt
Thomas's attention to the fact that be-
sides the regular PA per cent depreciation
which had been deducted for the last
three years 100000 was set aside a'
depreciation reserve in order that the
wears earnings would not appear S.
large.
The writer said that the company
sugar was inyoiced at cents, and that
Judging from the market indication, there
was at least SlOpo,0DO in profit which
would show up in the next years busi-
ness Mr.. Morey wrote that the tota
surplus shown In the financial statement
was s. 10000 but that the value Of ID,
real estate and railroads over and above
the amount at which they were carrie
was 10000. 50 that the surplus was
really nearer 100000
William T.. Hayemeycr, when called e
the stand. said that he was unable 70 e..
any OF the circumstances surrounafns
the formation Of the American sugar Et-
filming Company, but said that his I'M
preston was that the purpose was TO
amalgamate all the rehHerics into one
holding company, and That the itu''ha
OF the court caused them TO make th"0
move. Mr. Hayemeycr said that tNe
American Sugar Refining Company was
capitalized at 100000. but that he VAL
ued the concerns az $-J,U0ON
Mr.. Havemeyer testified that the pro-
duction OF sugar was curtaIled because
Of the competition, and that those iae-
tories closed down by the board OF trus'
tees were not profitable.
The witness then admitted that aiteL
IN. forming Of the trust tho cost o.
refining sugar was cut from 80 Dents =
hundred 20 % cents hundred.