The Birmingham age-herald., 1913-03-03

terms Mr.. Conant continues, "have been
reported in a number of instances but
| the general policy of the company is to
maintain high prices in the monopolized
INES; IN the principal new lines, how
ever, where considerable competition is
encountered, unusually low prices and
long terms have been generally employed.
Another rather general complaint is
! that statesmen of the International Har-
! vester company represent that purchas-
ers Of competing lines of harvesting ma
| chimes viii be unable to secure repair
parts, matter of much practical inn
portanee. Officers of the international
Harvester company admit that this was at
one time common characteristic of com
petition in the harvesting machine indus
try, but that the company Is opposed to
the practice, and has used active efforts
to eliminate 1t. The bureau, however. re-
ceived rather numerous complaints of this
character.
THE company at one time openly at
tempted through clause in its commits
sion contracts. to control the price paid
for Its machines by the farmer to the
retail dealer Since the elimination of
this clause, suggested' retail price lists
have been rather generally circulated by
some of its branch officers, apparently
for the purpose of Indirectly maintaining
the retail price. although the company
contends that these lists are intended for
the use of its employees in furnishing in
formation to purchasers and processes to
discourage their issuance to dealers 1t
is evident, however, that it could com
pleteiy stop this practice If it really
wanted to-"
Although new competition of great sig
nlf1cance has begun to appear, the COM
missioner points out that the combination
In 1911 still had about Sc per cent of the
production of binders, rs per cent of the
m a.4fI not ftx.ta f,f
the production OF rakes
Tn manure spreaders, he adds. II
appears to have over one-half of the
business. in disk harrows approxi-
mately 40 per cent, and to be increas-
Ing Its proportion in several other
lines, such as wagons and gasoline en-
gines.
Enormous Capital
"The extraordinary over capitaliza-
ton which characterized most of the
large Industrial consultations of the
period of 1898 TO 1901 was absent in
the case of the International Harves-
ter company; says Mr.. Conant The ori-
ginal capital of S120000.000 included
$50, 900, 900 in cash and 100000. 900 rep
resenting the appraisal value OF plants,
inventions, etc. The commissioner
point out several alleged excessive val
uations, but says that the value of the
properties plus the cash capital COW
cred substantially 80 per cent of the
capital stock issued and holds that a
fair valuation for good will" which
was not included in the assets, would
likely have met the remaining 10 per
cent.
Excessive valuation the commission
er particularly points out was placed
upon the ore leases of the Deering
Harvester company. 1t was appraised
at s7963,750, estimated by Mr.. Conant
to have been over $7,000,000 too high
at that time. These ore valuations,
he adds. caused much dissatisfaction
among the combining interests them
selves, especially the McCormicks.
at Is important to consider" the
report declares, chat the bankers who
dominated the organization of the In
ternationa1 Harvester company, also
organized the United States Steel cor
poration, officers of which had only a
few weeks before in important litiga-
ton then pending against that COM
pany submitted affidavits to the effect
that the value of its ore, taking lease
holds and fee unfortunately, was
100000 or approximately 81 per
ton Mr. Perkins. to whom was left
the appraisal of these ore properties
and who was also chairman of the fl
nance committee of the steel corpora
ton, was therefore In no position to
deny an excessive valuation for this
Deerngs ore.
The stock of the company. says Com
missioner Conant has been closely held
by the former interests. the Mccormick
and Deering families having through
out held large majority of the total,
while considerable amounts also have
been retained by other stockholders.
"This fact" he continues, assumes
especial Importance, in view of the
pending dissolution suit of the govern
fr,cf "
| Pointing to the recent action of the
company in splitting. into two corpora
tions each with s70,O0O,Oo0 capital stock
one retaining the old harvester ma
chine plants, and the other taking over
the new lines and foreign business,
Mr.. Conant comments.
"If this is intended as part of a plan
for ultimate disintegration of the COM
bination, in the opinion of the bureau,
1t is unsatisfactory"
The investigation, the report says,
disclosed low rates of profit In the
early years of the combination, partly
owing to imperfect organization and
internal jealousies. but much higher
rates in recent years averaging about
125s per cent in 1909-1911 on net assets
exclusive of good WILD, according to
the bureaus estimates. i
Generally speaking" says the CON-
missioner, "the prices obtained by the
company on foreign sales are relatively
higher than those in the domestic mar
ket, netting in some cases lower mar
gin of profit"
Mccormick Issues Statement
Chicago, March 2.-Cyrus H.. McCor-
mick, president of the International Har