New-York tribune., 1922-05-18
Stock of Steel Company
Reaches Highest Mark
of Year in Belief Beth.
lehem Is TO Absorb II
Chadboul'ne Denies
Blow to Merger
Attorney Asserts 6 Com.
pany Merger Is Proceed.
ing,Despite Alleged Shift

Concentrated buying Of Midvsle Stee,
and Ordnance shares on the Stock
Exchange Yesterday was associated
with reports that overtures had been
made by Charles NJ. Schwab and his
associates in the Bethlehem Stee, Cor
poratlon for control Of the company.
The stock. which gained AS points
net at the close and reached n,y hiQb
lor the year at 45ls, advanced spec
tacularly in the afternoon while con-
ferences were still going on at the
Offices Of Kuhn, Loeb G. Co.. between
members of the six company group.
including the Midvale company, which
was represented by William r. Corev.
chairman.
Although Thomas L. Chadbourne,
legal representative of the six com.
panles endeavoring to reach an agree
ment for merger of their interests.
again denied that any deal was pending
between Midvale and Bethlehem, Wall
Street was inclined to look upon the
acquisition of the Corey concern as
more than possibility. Should Nv
Schwab make an offer attractive
enough for MIR. Corey to accept, that
would leave the Youngstown Sheet
and Tube Company, Republic Iron and
Steel. Inland Steel, Brier Hill and Steel
anu Tube to carry on the merger
negotiations.
Chadbourne Denies Dicker
Should Midvale be taken over bv the
Bethlehem en- Lackawanna combine it is
believed that it would be only ques-
tlon of time when Republic would he
acquired.
II can say absolutely and unouali-
fedly that there have been no negotia-
tlons between either Midvale or Re-
public and Bethlehem Steel for their
acquisition by the latter concern" de-
clared Mr.. Chadbourne. "Furthermore.
| do not believe there will be any.
The fact that Midvale advances rapidly
in the stock market is no criterion Of
a new deal. Is it not likely that the
public is buying the stock?
u can say with the fullest confidence
that if Midvale Steel officials at any
time commence negotiations with Beth
lehem or any other company the exec
utives of the other companies now ne
merger will be notified Immediately
Mr.. Corey, Midvale's chairman, is one
Of the most honorable gentlemen !
have ever known, and he would not
think Of doing anything underhanded
or covert. If he is approached by Beth
lehem we will know it, and there has
been no notice served on us.
Developments affecting the steel
mergers have been known by US all the
way through. When Inland, Steel and
Tube and Youngstown began negotia-
tions Of their proposed merger they
Informed the remainder of the steel
companies Of their action, and said
they would continue with their ap-
praisals and valuations until they were
convinced that no definite headway
could be made.
Must Limit Capitalization
"Similarly, when Lackawanna began
negotiations with Bethlehem, Mr..
Downs, the company's president, in
formed every member of our group OF
the move, and there was nothing secret
about that deal. Mr.. Downs was abso-
action, although | will admit that we
did not think the Lackawanna- -Rethle-
hem merger would be contaminated.
CAS- to whether Bethlehem interests
could purchase control of Midvalc in
the open market, ! would not want to
hazard e guess. No signs have ap
peared. in my opinion, to indicate such
move There are $4,000 stockholders
Of Midvale, and |, Of course, cannot
speak for them, but | do not think that
Bethlehem is after control of either
Mdval or Republic
Mr.. Chadbourne said that consider
able progress has been made in the
negotiations involving the six-company
merger and he expressed confidence
that it would be successfully. con-
cluded.
I'VE are getting nearer basis every
day" he explained. THE bankers have
drawn a theoretical ring representing
the limit of capitalization the con-
.olidated corporation would have, and
all companies are told to get inside this
ring. The problem is to allot definite
percentage of this limit to each COM
pany. can say this, that when the
combination is effected the new cor
poration will have fixed charges and
preferred dividend requirements OF
only St.1O per ton of ingot output,
which will put it in an enviable position
as compared with some steel COM
panies."