1903-10-09-New York Times-Denial by Morgan and Co.
New York Times
9 October 1903, page 1
DENIAL BY MORGAN & CO.
Statement of Connection With Shipbuilding Trust. HOW SHARES WERE SOLD Mr. Untermyer Says There is no Quarrel with Banking Firm -- Correspondence on the Underwriting Plan.
"Neither the firm of J.P. Morgan Co. nor any partner ever had any connection with the inception, organization, or financing of the United States Shipbuilding Company, nor have they ever received or owned any of its securities. As managers of the United States Steel Syndicate, we held the Bethlehem Steel Company stock until a purchaser could be found. It was transferred to the United States Shipbuilding Company at exact cost, and the preferred and common stock which were received in lieu of interest and earnings of the company were sold at private sale for $75,000, and the proceeds were distributed as part of the profit of the United States Steel Syndicate.
"Any statement that we were parties to any agreement for selling the stock is wholly untrue."
A Paris cable dispatch of July 11 from John W. Young, promoter of the shipyard trust, was among the early messages quoted in the report of Mr. Dresser.
HAD ARRANGED SALE.
Mr. Young wired that "we" had arranged "sale $2,500,000 bonds available few days." He added that the balance needed to pay all options would be placed "in good time." Under the same date "Maccook" sent a message to "Young, c. Trebor, Paris." in which he said:
- If Paris underwriters are good, they must respond to call same as underwriters here. If not good, the quicker known the better, so we can work here on balance necessary.
On the next day "Maccook" cabled to "Beatty" that the New York end must be informed promptly whether the Paris underwriters would respond to the call for the first payment to be made during the next week, and three days later another message from "Maccook" read as follows:
- Legal responsibility of minor importance: we must know exactly how much Paris underwriting will respond in cash to dcall. This should be ascertained by direct inquiry if necessary. Will Rogniat and Schreyer respond. * * * Depend on you for this information to-morrow.
"Beatty" replied that "Doctor Silvy, Rogniat's lawyer," advised him that all the underwriting was legally enforcible, and that he himself had seen two banks, discovering the financial reliability of "Notary Schreyer's son" and "Napolitani." The former was to take a million and the latter was "underwritten for fifty."
One day later Mr. Alexander ("Batty") cabled to Col. McCook that he had further assurances of the success of the plan. Two more days passed before the following personal note by cable:
- Maccook, New York:
- Koch, who underwrites eighty bonds, businessman. Fiers says Koch has $20,000 a year. Lehman Freres says Mayer, (Victor Mayer,) who underwrites 350 bonds, has rich mother and family, and well placed himself. BEATTY.
About this time came a cable dispatch from John W. Young to Lewis Nixon, the former declaring that his commissions were due, inasmuch as "Alexander's examinations on behalf of Mercantile Trust as to validity Paris underwritings show it substantial." Mr. Alexander, after sending messages telling of "slight delay," cabled on July 26 that he had caused it to be known that a leading English barker had said he could get $1,000,000 in twenty-four hours. He added: "Which is true, of course." Two days later, in a letter to Alexander & Green, he said the Italian underwriters were the only ones unwilling to pay, apparently, but that Dr. Silvy had advised Rogniat that he was liable under the French law to keep his agreement.
