New-York tribune., 1916-02-19
Schwab and Grace Give
Out Purchase of Control
for $31 100000.
RICH ORE AND COAL
DEPOSITS INVOLVED
Acquisition VIII Aid Exports and
Expansion of Bethlehem, An
nouncement Says.

Formal announcement Of the acquisi-
tion of the controlling stock Of the
Pennsylvania Steel Company by the
Bethlehem Steel Corporation, fore
shadowed for several days, was made
last night. The official statement was
issued by Charles NJ. Schwab, chair
man, and E. G. Grace, president. Of the
Bethlehem Steel Company. 1t was re-
marked in Wall Street that the merger
came at a peculiarly significant time.
Yesterday was Mr.. Schwab's fifty
fourth birthday. That. Of course, had
nothing to do with the closing or the
transaction, but in the financial district
II was generally agreed that Mr..
Schwab had provided an especially val
liable ally for mis- company on his an
niversary.
The announcement by Schwab and
Grace said:
"The purchase price aggregates ap-
proximately s3l, 100000. which Is at the
rate of par for the preferred shares
and Lbout s27 share on the common
shares Of the Pennsylvania Steel COM
many. This amount IS TO be paid IN
per cent twenty-year purchase money
bonds Of the Bethlehem Steel Company,
secured by mortgage on the purchased
property. with the reservation OF bonds
TO retire underlying issues and 70 pro-
vide for improvements and additions. ..
"This acquisition IS the outcome OF
the determination reached by the Beth-
lehem Steel Company some time ago
20 add TO its output Bessmer steer
products and other general steel lines
such as bridges, frogs and switches;
eirder rails, etc. For a number OF
reasons 1t seems that It would be pet
ter 70 accomplish these enlargements
by acquiring the plant OF the Pennsyi-
vania Steel Company rather tnan 20
await the erection Of additional plants
at Bethlehem.
plants admirably supplement those a.
Bethlehem The Sparrows Point plant
gives to Bethlehem plant at the sea-
board which it had long desired 70 de-
velop its export trade. The purchase
also brings favorable ore properties,
both IN TnlS county aAN tti
also important coal deposits.
with closing this transaction, the
final disposition Of the Pennsylvanis
steel Company stock, which was owned
bv the Pennsylvania Railroad ana
Reading Railroad interests, and "hlcn,
has been on the market for seyera'
years. has been provided for: Nego-
tiations for the purchase by the beIh-
lehem interests have been pendlns 10,
several weeks Before that there nsd
been rumors Of several other posSlo'e
purchasers. -... ,,.or.
NEGOTIATING as carly as last Sep'enDe,
for the sale Of the Pennsylvania otes
shares 20 the Bethlehem group A.
that time there was hitch IN the ar
rangements and the deal was broken
off. not 10 be reopened until after the
recent sale Of the Cambria Steel Com
many to the Midvale Steel and ordnance
Company. headed by William T.; corey
Outstanding stock Of the Pennsyi-
vania Steel Company consists OF s%V'-
56O. 500 preferred and slO,75OOOO com
mon. OF the preferred stock me
Pennsylvania Railroad interests owne1
so $4,000 par value. while the same
group held total OF T,3Ss,9oO COM
mon stock. The Reading Iron Com.
many owned S3,I00,000 common stock OF
The Pennsylvania Steel Company.
G Grace was elected resident OF
tho pethlehem Steel Corporation az
meeting of the directors yesterday. lie
succeeds Charles VI. Schwab, who re
mains at the head of the corporation as
chairman OF the board.