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PUBLIC RECORD OFFICE, LONDON ALLY WITHOUT PERMISSION OF THE COPYRIGHT PHOTOGRAPH-NOT TO BE REPRODUCED PHOTOGRAPHIC-

of interest of the Merton concern, we should like to mention that the American Metal Company stands in close business relations to the Société le Nickel in Paris, which runs large nickel mines in Canada, New Caledonia, and elsewhere, as well as to the Société Aluminium Français, the trust-like association of the French producers of aluminium. These relations are based chiefly upon the commercial activity of the American Metal Company, the latter selling the pro- ducts of the former. However, in some cases they exceed this sphere, the American Metal Company, for instance, being engaged in the Southern Aluminium Company of New York, which was established by the French group in connexion with Swiss and French banks, and has a capital of four million dollars preferential shares and 2-4 million original shares.

As regards the stocks owned by the Merton Metal- lurgical Company of London I have not been able to obtain details. According to the balance sheet for 1911, they amount to 660,671 pounds sterling, and probably consist entirely of shares of the non-German development and producing companies.

It will be seen from the above statements that the Metallgesellschaft-in spite of the independence of the firm of Henry R. Merton & Company and the American Metal Company as commercial enterprises -is the stock-capitalistic head of the whole concern, the rest of the companies being practically daughter companies. But even this stock-capitalistic concen- tration of all the various enterprises in the Metall- gesellschaft and the Metallurgische Gesellschaft proved to be insufficient, and led in the year 1906 to a highly interesting expansion of the whole concern. In that year the Metallgesellschaft, the co-operation with the Metallurgische Gesellschaft, the Deutsche Gold und Silberscheideanstalt, the Darmstadter Bank, the Ber- liner Handelsgesellschaft, the Discontogesellschaft, and a number of private banking houses of Frankfort, established yet another controlling and development company on the largest scale, namely, the Berg und Metallbank Aktiengesellschaft of Frankfort-on-Main. The share capital of the new company was fixed at not less than 40 million marks, 28 million marks of which were introduced at the Frankfort Exchange, whereas the stocks of all the other companies remained entirely in the hands of the founders. The new company was, therefore, founded for the purpose of obtaining foreign capital for the extensive enterprises of the Merton concern. The second object in view was the realization of the large premium of the shares of the Metallgesell- schaft and the Metallurgische Gesellschaft; the Berg und Metallbank taking over four million marks worth of nominal shares of the Metallgesellschaft at the course of 315 per cent., that is to say, for 12.6 million marks, as also shares of the Metallurgische Gesellschaft to the amount of 1 million marks at a course of 250 per cent.

Later on, the Berg und Metallbank took over shares of Henry R. Merton & Company amounting to 118,750 pounds sterling, mostly at a considerable premium, against 3,391,500 marks; 759,000 dollars of the American Metal Company, Limited, against 4,969,440 marks; furthermore, at pari, 325,000 pounds sterling (paid at 25 per cent.) of the Merton Metallur- gical Company, Limited, against 1,657,500 marks, and

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390,000 dollars shares of the Metallurgical Company of America against 1,638,000 marks. The total stock property amounted to 30-6 million marks, the dividend The company for the first two years to 6 per cent. afterwards engaged also in financial transactions in connexion with the mother companies, and had credi- tors to the amount of 41-4 million marks.

This latest enterprise is remarkable for its size as well as for its purpose and the nature of its trans- actions, and has become the head proper of the whole concern in lieu of the Metallgesellschaft. Although it owns only one-fourth of one-third of the capital of the principal enterprises of the Merton concern,_viz., Metallgesellschaft, Metallurgische Gesellschaft, H. R. Merton & Company, American Metal Company, etc., it controls, together with the personal property of the Merton family, the whole of the enterprises, that is to say, the capitalists banking it are now controlling the concern by it as they used to do through the agency of the Metallgesellschaft. Of course, they can only do this if more than half of the stock capital of the Berg und Metallbank are in their hands, and care has been taken to distribute the remaining shares as widely as possible among the public.

The Berg und Metallbank bears the title of a bank with somewhat more justification than most of the financing companies, because it carries on a fairly large bill brokerage for the sub-companies of the concern. In 1911 the assets showed 1-7 million marks worth of drafts (minus discount), and the liabilities bills amounting to a little over one million marks, to which were added on either side sureties of nearly two million marks. Debtors owed a little over four million marks, and creditors had to be paid 4.44 million marks. As the Berg und Metallbank does not carry on any metal trade of its own, these figures refer only to the business with the sub-companies. The institution is, therefore, a financing company, but it is remarkable and unique for the fact that it is at the same time the head of the whole Merton concern, whereas in reality it is chiefly

a development company acting for the private capi- talists who control it in the end.

Was

In the year 1910 the great financial transactions The took place in the whole of the Merton concern. first was the establishment of yet another promoting company, this time in Switzerland, in connexion with the Schweizerischer Bankverein, Swiss Banking A880-

at Bale established

the There ciation. Schweizerische Gesellschaft fuer Metallwerke with a capital of 20 million francs, of which 16 million This company soon francs were paid up in cash. afterwards floated a 4 per cent, debenture loan of 18 million francs. Again a large portion of the stocks of the concern were moved about. The new company took over (and obviously mostly from the Metallbank) shares of the Henry R. Merton & Company, Limited, amount- ing to £118,750, which is exactly the amount owned previously by the Metallbank, at the exchange of 200 per cent., or 4.8 million marks, whereas they had been booked by the Metallbank at 34 million marks. The company also took over 7.6 million marke shares of the Metallgesellschaft at the exchange of $15 per cent., that is to say, at the same rate at which four million marks had been invested in the Berg und Metallbank.