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* MARINE REVIEW Entered at Cleveland Post Office as Second-class Mail Matter, Published every Thursday at 418-19 Perry- Payne Bldg., by the Marine Review Pub. Co. VoL. XXIII. CLEVELAND, O., MARCH 7%, 1901. Subscription $3.00 a year. Foreign $4 50 a year. No. 10 UNITED STATES STEEL CORPORATION. SOME FEATURES OF THE BIG ORGANIZATION TAKEN FROM THE ANNOUNCE- MENT BY J. P. MORGAN & CO. TO THE STOCKHOLDERS OF THE VARIOUS COMPANIES REGARDING TERMS UPON WHICH THEY WILL BE TAKEN INTO THE CONSOLIDATION. ° The official announcement of the organization of the United States Steel Corporation is in nearly all respects in accord with what was pub- lished in these columns a week ago. The publicity given to it by the house of J. P. Morgan & Co. has been so great that no one in the least concerned in the deal can possibly be unfamiliar with the terms. Indeed, the corporation has spent a pretty penny to advertise the consolidation, for it has taken four columns of reading space for several days in all the leading papers throughout the country—and this is the most costly form of advertising. The language of the official announcement is as clear as sunlight. Among the first facts disclosed regarding the great enterprise is that the authorized capital stock of the corporation will be $850,000,000 or $50,000,000 more than was first understood. It will be equally divided into 7 per cent. cumulative preferred and common stock. The company will also issue its 5 per cent. gold bonds to an aggregate amount not exceeding $304,000,000. The bonds are to be used only to acquire bonds and 60 per cent. of the stock of the Carnegie company. The underwriting syndicate, which, as was previously known, was for $200,000,000, has made a con- tract with the United States Steel Corporation under which the latter is to issue and to deliver to the syndicate its preferred stock and its common stock, and its 5 per cent. gold bonds in consideration for the stocks of the combined companies and the bonds of the ‘Carnegie company and the sum of $25,000,000. It is understood that the $25,000,000 in cash is for additional working capital for the new company. The list of depositaries of the stocks of the combined companies includes several of the most prominent New York trust companies. Deposits must be made on or before ‘March 20, after which date no deposit will be received except in the discretion of the syndicate managers and on such terms as they may pre- scribe. The basis of exchange of the stocks of the United States Steel Corporation for the stocks of the various companies has already been pub- lished in the Review, but for the sake of cohesion in the narrative it is herewith reproduced: Amount of new stock to be delivered in par value. . “Name of company and class of stock. Facies commen Mederal Steel Co,, preferred... 72.0 0.. 0.20. $110 ae Moderat otec!, Co... COMMON oes ease ete ene 4 $107 .50 American Steel & Wire Co., preferred.......... 117.50 ae American Steel & Wire Co., common.......... . ales : 102.50 National Lube Co. preferred... 20... see es Ree ee es ae ational ube: Co. COMMON. ok .k co seicase ote vos 5080 125 ational Steel Co..-preferred. 2.5. 20.7 e ss 125 a Mane! steel (CO... COMMON, cic .5. ute caer coe ee ess 1 American Tin Plate Co., preferred............. 125 se American lin Plate Co., common: S280. 6.6. 20 il American Steel Hoop Co., preferred........... 100 i. American Steel Hoop Co., common........... 1... 10 American Sheet Steel Co., preferred............. 100 ae or American Sheet Steel Co., common............. eee ees The syndicate managers state that at any time prior to the deposit of two-thirds in amount of all outstanding shares of the capital stock of any one or more of the companies to whose stockholders the announcement is addressed—which two-thirds in each instance shall include two-thirds of the outstanding preferred stock of such company—the managers Z their discretion may withdraw the offer made to depositors of shares o any such company of whose capital stock two-thirds shall not have Beep deposited. In such case no act or notice of withdrawal shall be bene other than the advertisement thereof at least once in each of two deny newspapers in New York city. Deposited common stocks must cathe dividends or rights to dividends declared or payable on or after Marc 1901, and no adjustment or allowance will be made. In the case gi preferred stocks, however, proper adjustment will be made in respect 0 dividends upon all the shares deposited, so that the registered holders of receipts for such preferred stocks will receive the equivalent of divi- dends thereon at the rate therein provided from the last dividend Mies up to April 1, 1901, from which date dividends on the preferred stock o the United States Steel Corporation are to begin to accrue. The an- nouncement further says regarding dividends and the corporation's earn- ing power: Se “For the purpose of avoiding the necessity of interruption in the aa laration and payment of dividends, when earned, upon the oo oa : concurrently with the payment of dividends upon the preferred stock, there has been inserted in the charter of the United States Steel Corporation a provision to the effect that whenever all quarterly dividends accrued upon the preferred stock for previous quarters shall have been paid, the boar of directors may declare dividends on the common stock out of any re- maining or net profits. Statements furnished to us by officers of the He eral companies above named, and of the ‘Carnegie company, show oe the aggregate of the net earnings of all the companies for the calen = year 1900 was amply sufficient to pay dividends on both classes of the new stocks, besides making provision for sinking funds and maintenance of properties. It is expected that by the consummation of the proposed ar- rangement the necessity of large deductions heretofore made on account of expenditures for improvements will be avoided, the amount of earnings applicable to dividends will be substantially increased and greater sta- bility of investment will be assured, without necessarily increasing the prices of manufactured products.” : In order to set at rest the wild stories regarding fabulous profits to the house of J. P. Morgan & Co. for bringing about the consolidation, the following terse statément is made: “It is proper to state that J. P. Mor- gan & Co. are to receive no compensation for their services as syndicate managers beyond a share in any sum which ultimately may be realized by the syndicate.” LAKE SHIPS AND THE STEEL COMBINATION. Newspaper dispatches have been all wrong as to number of lake ves- sels that will be owned by the United States Steel Corporation. The number repeatedly stated is 124. It is just half that amount, fifty-six. The fifty-six (all of them are steel) include twenty-two to be acquired from the Minnesota Steamship Co., which is a part of the Federal Steel outfit; thir- teen from the Pittsburg Steamship Co., a Carnegie interest; twelve from the American Steamship Co., recently taken over by the American Steel & Wire, and nine ships of the ‘Mutual and Menominee lines, operated by M. A. Hanna & Co. for the National Steel Co. Even if the Rockefeller prop- erties on the great lakes were included in the big consolidation the num- ber of ships taken over would not number 124, as the Rockefeller fleet, large as it is, numbers only fifty-six vessels, including three that are now on the Atlantic seaboard. The importance of the gigantic Morgan deal from the standpoint of the lake ship owner must not be underestimated, but there are still a few vessels on the lakes to be taken into account while the transportation business continues to grow as it has during the past ten years. It must be admitted that the freight outlook for the immediate future—the season close at hand—is decidedly discouraging to the so- called individual owner, but from all appearances John D.- Rockefeller’s interests still tend towards the carry end of the business, and apparently more so than at any time since he acquired a share in the trade. It would seem, therefore, that his position should be a matter of encouragement to the smaller owners. : Some of the managers of the fifty-six ships that go to the new steel combination are, of course, a little concerned as to where they will land when the process of concentrating management is undertaken. The same is true of men in charge of mines, docks and other departments. But there is no great amount of worry on this score as yet, as it is not probable that any radical changes will be made for next season, and probably not for a longer period to come, as some of the concerns going into the con- solidation are under contract obligations pertaining to ships and mines that cannot be brushed aside in a hurry. GRAIN SITUATION IN NORTHWEST. Mr. A. G. Tomlinson, vessel agent at Duluth, makes the following report regarding quantities of grain in store at Duluth and Superior on the 4th inst. compared with the same date a year ago: 1900. 1901. Wheaten sicn Veit Cu eee 11,432,979 7,721,119 BALTIC. tory ss ee eee 172,084 74,617 Pa yea ts os cans aa ae ee es 312,930 332,356 Qatar ee os weve eS 157,399 1,017,192 ReGen ee 398,608 310,545 COT i Seana ee ne ee 811,951 4,267,251 13,285,951 13,723,080 The report adds: “A little business was again accomplished in freights last week at 2 cents, opening shipment. The inquiry for tonnage, however, was not general. The weather has been extremely mild, but is again colder. ‘Clear water prevails about three miles from the piers.” Freight conditions in the Atlantic seaboard trade seem to have grown steadily worse for two or three months past, and it is quite probable that all the owners of lake vessels sent to the coast last fall are regretting their action. Among the better class of vessels that went down the canals are the Hawgood steamers Eureka and Tampico and the Paraguay and Asuncion of the American Steamship Co.’s fleet, managed by Mr. A. B. Wolvin. The Eureka and Tampico will probably come back to the lakes as early as possible in the spring. The condition of low freights probably prompted the charter of one of the Wolvin steamers to Pacific coast in- terests. She is to go around the horn and engage in trade between San Francisco and Puget sound. Mr. J. C. Gilchrist has four wooden barges— Bacon, Verona, Crosthwaite and Sheldon—on the Atlantic coast. He will bring them back to the lakes in the spring. The custom house officials at Sault Ste. ‘Marie have made application for another inspector to assist them in their work. They represented to the government that the traffic between the two Saults had grown to such proportions that the office force was inadequate to cope with it. The reply of the government was to make a detailed report upon all rigs, passengers and pedestrians passing to and fro during one week. This has been done with the result that during the week ending March 3 it was found that 2,716 rigs with 5,442 passengers and 6,651 pedestrians had crossed the river. The business, of course, will be largely increased when navigation opens. At the Lorain works of the American Ship Building Co. another of the eight steel steamers under construction for ‘Mr. J. C. Gilchrist and others of Cleveland was launched on Saturday last and named Venus. Still another of these freighters, the Mars, will be launched at Wyandotte Mich., next Saturday. Te ce