The Bozeman courier. (Bozeman, Mont.) 1919-1954, 1922-01-11
EXPLAIN PURCHASE
AMERICAN BRASS
A. c. M. Co. Tells Why Control of
That Manufacturing Plant Was
Secured.

John d. Ryan, chairman of the
board, and C. F. Kelley, president,
of the Anaconda Copper Mining COM
pany, authorize the following state
ment:
at has been a growing convic-
ton of the officers of this company
that the large investment required to
carry on the business of mining,
smelling and refining copper and zinc,
was inadequately protected, that the
business lacked a stabilizing influ-
ence, so long as the producers could
not reach out to the ultimate consum-
ers of their product and take the steps
which it is believed necessarily must
be taken if the copper producers are
to meet the competitive effort of the
producers of other metals in market
ing and distributing the same.
The initial result of this conviction
was the establishment of the wire mill
at Great Falls. The results achieved
have demonstrated the wisdom of this
step. Since the beginning OF the op-
erations on June 9 1918, to the end of
1921, the wire mill has drawn into
rods and copper wire a total of 1866
000,0 pounds of copper, which have
been distributed at a manufacturing
net profit of $3.50, 600; the total in
vestment being $1,057, 1908, re-
duced to $3.50, 100000 after allowing
for depreciation.
When it became necessary last
February to take the forced steps to
shut down all of the mines of this
company, as did also most of the
other large producers on the hemi-
sphere, the necessity for acquiring
such outlet for production was en-
phasized by the fact that the produc-
tion of the wire mill was sold ahead
for many months, so that during prac-
tically the entire period of the shut
down, it has been able to continue the
manufacture and sale of rods and wire
at a substantial manufacturing profit.
About this time the officers of the
company undertook an intensive study
of the manufacturing and fabricating
situation in the United States. From
this study it became apparent that
further building of plants would
merely add to an already over-con-
structed mill capacity and that an eff
fort in this direction by the company
would result in adding decentralization
rather than sterilization to the situa-
ton.
The second proposition that became
apparent was that the American
Brass company dominated the manu-
!, featuring and ~fabricating situation in
copper and brass, its plants having a
capacity equalizing approximately &C
per cent of the total copper and brass
: manufacturing business of the United
States. This volume would utilize the
maximum production of copper anC
zinc capable of being made by thi:
= company.
Negotiations were therefore under
taken for the purpose of determining
whether or not it was possible to Sc
cure the American Brass company, o.
a control of its stock, for the Ana
conda Copper Mining company.
In addition to the direct advantage
embraced in securing such control, tn
indirect beneficial results have bee
carefully considered.
AS an illustration, during 1921, be
cause of the inability of the Anacond
company to market its copper and Yin
d output, the necessity was forced upo
4. 1t to suspend operations, which it
estimated cost the company $4,000
900.
During this same period, the plant
of the American Brass company OF
= Grated upon a basis which wc--i1 HAY
enabled the Anacorfa ~. a1y I
have produccI T990),, 60 c-als
4. copper and a least l,Co0,G00 poant
OF zllc per i-ont ring the enti
2eriol Of the shutdown, without az
aCcu. lulat;on of metal stocks. Tn
would have enabled the Anacont
OF company to have avoided the nece
sity for closing it's plants and resul
ed in the saving of $4,000, 900 in shu
down expense and would have been
OK stabilizing factor in the economic CO
OF dition of Montana and of the emit
copper industry.
90 These in brief are some of the re
sens which, in the judgment of t
20 board of directors, make the acqui
ton of American Brass stock a (
sirable transaction and which ha
,.66 influenced the decision to author
it's purchase for the Anaconda O.