OTHER PEOPLE’S MONEY

Sun (Auckland), Volume 1, Issue 40, 10 May 1927, Page 2

OTHER PEOPLE’S MONEY

THE FRIENDS OF FORD SOME FELL BY THE WAY% By PERTINAX Twenty-four years ago 12 n lPn in a bare little office and form*?* company to build cheap motor 4 Ten years passed, and five of the7* inal men dropped out for one iJT* or another. The seven who ren2? : were millionaires. Six years later of the seven. named Henry r« 0t ; bought out the others for £ 16.000 (T' The group of 12 speculators prised two young lawyers, a carpem two mechanics, a book-keeper, a 7 dealer, three shopkeepers, a bankeril! a-n inventor. The company t> formed had a capital of 1.000 shart* £ 2CT each, and the holders wer» e I follow: Henry Ford 2^ss*^ A. V. Malcolmson 255 James Gray j os H. E. Hodge , .. .. J. F. Hodge Chas. H. Bennett J. W. Anderson H. H. Rackham V. C. Fry st A. Strelow 5, James Couzens 2j „ C. J. Woodall For a short time Ford and Malcoin son (a coal dealer in a small way 7 business) had been in partnership & veloping the manufacture of the car and this partnership, including pi*., and the inventor’s rights, was put in; the company for £ 10,500, most of imbalance of £9,500 being subscribed •- cash by the remaining ten sharehold ers. Malcolmson became treasurer c the company, profits began to be earn* and the first years’ sales totalled ljj; cars. He then began to cast *W with a view to organising his own coin pany. The other members heard about this held a meeting, taxed him with the** proceedings, and requested him to r*. sign within five days. He did so, w demanded £40,000 for his sharW which represented an investment c £5,100, probably believing that th-> purchase price could not be found b his old associates. FORD SECURES CONTROL By the first of the financial miracles Ford borrowed the necessary funds and bought Malcolmson's shares, then holding 510 out of the 1,000 issued With his profits Malcolmson startec the Aero Motor Co., which became insolvent. The next to miss his chancof a fortune was the carpenter, Alber. Strelow. He wanted capital to invest in a gold mine, and offered Ford his 50 shares for £5,000. This offer wai accepted, and Strelow put the money into the mine, which proved a failure his investment being wiped out Nothing further seems to be known abort him. The three others who fell out were the shopkeepers, Fry, Bennett and Woodall. One after the other, presumably because they feared to hold on, they sold their total of 110 shares to James Couzens, the book-keeper who had now become business manager of the Ford Company at a salary of £sof a year. He afterwards became Mayor of Detroit, and is now United State! Senator for Michigan. Couzens was the strongest believe: in Ford. His first investment was £SOO, which he had to borrow for the purpose. Later he lent the company £ 2,000 and bought the further 110 shares for an unknown amount In the 16 years, 1903-1919, he received £ 1,000,000 in dividends and sold out his shares finally for £7.000,000 to Ford’s son, Edsel. Having paid the Government taxation to the extent of £1,450 on the sale in 1919, he is now being sued for £1,891.000 more. When Couzens bought his origin;. 25 shares in 1903 he borrowed £2B from his sister, and allotted one of the shares to her. The sister seems to have been very sceptical about the whole thing, but probably changed her mind in 1919 when she got £52 for her £2O speculation. LAWYERS REAP RICH REWARDS Of the two young lawyers, one, M: Rackham, had sold a few small sections of land to raise the money for his shares, and did so. he confessed, in fear and trembling. He was rewarded with £400,000 in dividends and £2,500,000 sale price in 1919. The other, Mr. Anderson, had to borrow his £I,OOO from his father, who wa* a doctor in Wisconsin, and his return was the same as Rackham’s. Neither had any conception of their profit? until these began to roll in even as late as 1913. Anderson then being in Europe on a holiday, he had left a note with his adviser in anticipation of a Ford bonus, and had asked the amount to be cabled. If it proved be £5,000, cable “five,” and if Sizeable “ten,” were his orders. wner he receiyed a cable saying “one hundred,” he had it repeated at full “Ford shares bonus £100,000,” before he believed the figure. . The banker, James Gray, died betonj 1919, and at his death he; divided Jj* shares which he held for his ongfflJJ 105 among four heirs. They a total of £5,250,000 on the minorw sale. DODGE BROTHERS DROP OUT The most interesting personalities among the 12 founders ‘ brothers Dodge, who then “a®, largest machine-shop in Detroit. J ‘ connection with the Ford coro * ) arose through a contract to turn • 650 cars complete but for wheels bodies, for £SO apiece. They to get £2,000 on account, but sin _ the new venture had limited funds, • took this payment in the form ® 100 shares in their names. They had to borrow £ 8,000 to get ahea the contract. H«nrbe<i Eventually their shop was aDSor by the Ford plant and they were a his strongest supporters during • years of progress. Later they a * . E from him on matters of policy, a 1908 sued him for a share bonus, stead of allowing profits to a £^ urn coU n for expansion of business. The ordered a share bonus of £4,000. be made by the company. Later • left Ford and organised their gtorycompany, which is a separate Both of the brothers are now their estates are parties to the s ( I £850,000 in the present I Government to recover taxation 1919 sales of Ford. STOCK VALUES whangareT prices Messrs. Dalgety and Co., '' report having held their usual du- r stock sales at the following centr ing the past week. , _ ntr y 0 Broad wood: There was a good various classes of cattle andl c tion was keen throughout, young and beef selling at an advance nU3 2rates. Sheep were penned in bers and met with keen co J u»* Prices realised: Light fat_ cows i®s; finished sorts, £4, £4 to tgtr j. 3-year steers, £4 10s to £5; -'" ye fS r veS , £3, £3 5s to £3 15s; cows and cai> 1&s; to £3 7s 6d; store cows, —-to g u fls 2-year heifers, £1 15s to £-'• Ilv £1 10s to £2. Sheep: M.S. woolly gets, 13s 4d. yaX&t Waikiekie: There was a heavy J of all classes, beef predominating* J£gsts ing with keen competition in an (4 at an advance on late rates. R OU ntr»J* prime fat cows on account rv nl J. realised £5 to £7 Is; on . , aC f°£s O'Shea a line of fat cows sold at eo*" 9 on account A. Love a line of* lO*. averaged £5 6s; light fat cows, .. £4 12s 6d, £4 15s to £4 19 s - 3VS* steers, £4 8s; 2-vear steers. . forward cows, £3 10s: speyed 3? 13s; store cows, £1 17s 6d, erS , £* ; to £2 10s; 2-year Shorthorn belie os to £2 7s; 2-year Hereford £j £2 10s; hulls. £2 10s; dairy I 10s to £4. Sheep; MS. Ewes,