. 15
( 20)


On the other hand, French banks when faced with French stock market
regulations often invested through Belgian intermediaries. This is discussed in
detail in Feis, Europe: The World™s Banker, passim. Broder, ˜˜Banking and the
Electrotechnical Industry in Western Europe,™™ 479 (on Belgian use of French
Wilkins, History . . . to 1914, 550“55, 909n186; Lewis, America™s Stake, 72; on
the sizable London share in new bond issues for Consolidated Gas & Electric,
1911“1913, see Paul D. Dickens, ˜˜The Transition Period in American
Notes to Chapter 3, Pages 120“120

International Financing, 1897 to 1914™™ Ph.D. diss. George Washington
University, 1933, 259, 263, 265“67; Cities Service, formed in 1910, was a
particularly large recipient of capital from abroad. For these U.S. companies,
see Hausman, ˜˜The Historical Antecedents,™™ 38“39. In addition, the
Rothschild representative in the United States, August Belmont, attracted
money from abroad to the New York City subway system “ the Interborough
Rapid Transit (IRT). Wilkins, History . . . to 1914, 552“53. Stone, Global
Export of Capital from Great Britain, 42“381, contains information on British
˜˜Capital Calls™™ (1865“1914) in the electric light and power sector. Based on his
data, Wilkins calculated (for the present book) that in nine of the fourteen years,
between 1901 and 1914, the United States ranked ¬rst by a substantial amount
among all the countries around the world in tapping British capital markets for
electric light and power facilities. Wilkins believes that these particular British
interests in the United States were all ¬nancial “ that is, portfolio investments.
201. Wilkins, History . . . to 1914, 554. There may be some question as to whether
there was direct investment in the United States by Sun Life Assurance
Company and by Alabama Traction Light and Power Company Ltd. Lewis,
America™s Stake, 102, 566, includes Alabama Traction Light and Power
Company Ltd. (ATLPC) as a ˜˜foreign™™ Canadian-controlled enterprise and
has it on a list of foreign companies in the United States. But American
managers made the allocation decisions. As in many large U.S. businesses,
there was a separation of ownership and control. There was no need for
ATLPC to install management and no indication that it did so (ATLPC was
formed for purely ¬nancial purposes). With Illinois Traction, the Canadians
played a larger role, and in our view there is more ambiguity.
202. The one plan for a British free standing company to invest in Japan was the
proposed Anglo-Japanese Hydro-Electric Company Ltd. The project took
various forms, but apparently by 1909 the proposal was that half the capital
would come from Japanese sources and half from British sources. See inventory
online for Public Record Of¬ce (PRO), Foreign Of¬ce (FO) ¬les, FO 262/1475
(Reel 4). The inventory has the following extract from the ˜˜Minutes of a
Meeting of the Most In¬‚uential Men Held at the House of Marquis Katsura on
14 March 1909™™: ˜˜Marquis Inouye declared the meeting open and explained the
reasons for it being called which may be summarised as follows: He was happy
to say that owing to the friendly relations existing between Japan and England,
and to the Political Alliance, and the daily drawing closer of the bonds uniting
the two countries which, on the economic side, was leading to the formation or
consideration of joint commercial undertakings whose fruitful results would, he
believed, add to the permanence and value of the Political Alliance, the joint
Anglo-Japanese Hydro-Electric undertaking assumed a considerable national
importance, intensi¬ed owing to the fact that owing to the present commercial
depression in Japan, a dif¬culty had arisen at an advanced stage of the
negotiations, viz: the Japanese side found it dif¬cult to raise their half of the
capital. At this juncture, the British side had come forward with an offer to ¬nd
four-¬fths of the capital if necessary, but he was of the opinion that the Japanese
side should make a great effort to provide all of their half, especially as the
money market is now easing.™™ This project never materialized. We are indebted
Notes to Chapter 3, Pages 120“120 367

to Makuto Kishida (Nov. 20, 2005) for initially acquainting Mira Wilkins with
this proposed venture. Kishida directed us to the research ¬ndings of Takeo
Kikkawa, who concluded that ultimately the foreign direct investment did not
materialize, not because of the reasons given in the PRO document, but because
the British did not have con¬dence in the outlook for electric power in Japan.
See Takeo Kikkawa, ˜˜The Plan for the Establishment of the Japan-Britain
Electric Power Joint Enterprise after the Japanese-Russian War,™™ in Enerugi shi
Kenkyu [Research for the History of Energy], 12 (June 1983), 46“60 (in
Japanese), a paper that details the course of the failed negotiations from their
beginnings in 1906 to 1910; see also Takeo Kikkawa, Nihon Denryokugyo no ´
Hatten to Matsunaga Yasuzaemon [The Development of Japanese Electric
Power Industry and Yasuzaemon Matsunaga] (Nagoya: Nagoya University
Press, 1995), 39; our thanks to Yumiko Morii for the translations.
203. In Japan, there were foreign direct investments in electrical manufacturing, but
not in the utilities. Uchida, ˜˜The Transfer of Electrical Technologies from the
United States and Europe to Japan, 1869“1914,™™ 224“26; Toshiaki Chokki,
˜˜ ˜Japanese Business Management™ in the Prewar Electrical Machinery
Industry: Emergence of Foreign Tie-up Companies and the Modernization of
Indigenous Enterprises,™™ in Takeshi Yuzawa and Masaru Udagawa, Foreign
Business in Japan Before World War II (Tokyo: University of Tokyo Press,
1990), 198. Not only were there the unrealized plans for the Anglo-Japanese
Hydro-Electric Company Ltd., but Japanese public utilities sought (in vain) to
borrow in the London bond market. See, for example, Muneo Nitta, Tokyo
Dento Kabushiki Kaisha Kaigyo Gojunenshi [Tokyo Electric Light Corpora-
tion, Company History of Fifty Years] (Tokyo: Tokyo Dento Kabushiki
Kaisha, 1936), 93. The Japanese government was an established borrower in
London with a good record for maintaining interest payments. Michie, London
Stock Exchange, 91. Lockwood, Economic Development of Japan , 322, writes
that the Japanese borrowed heavily abroad during the ¬rst decade of the
twentieth century; it (Japan) sold national and local bond issues in Western
money markets, and secondarily semiof¬cial companies and electric utilities.
We are convinced that Lockwood is mistaken on the matter of pre“World War
I foreign borrowings by Japanese electric utilities, at least in relation to long-
term borrowings “ i.e. on the bond markets. After much effort in Japan,
although we can establish attempts to borrow and we can identify short-term
borrowing, we have been unable to verify any actual borrowing abroad in
foreign bond (or stock) markets by Japanese electric utilities in this period.
Stone, The Global Export of Capital from Great Britain, 142“151, in his table
on ˜˜Japan (1865“1914),™™ indicates zero ˜˜capital called™™ for companies in
electric light and power. As Davis and Gallman, Evolving Financial Markets,
26, indicate, ˜˜capital called™™ statistics have their serious limitations: ˜˜[T]he
term ˜call™ was used to describe the announcements of the ˜periodic
installments that were to be paid by the subscribers of the new issue.™ ™™ If
the Japanese were ¬nancing their electric light and power facilities in London,
however, there ought to be some indication in the ˜˜capital called™™ data. There
is evidence of short-term yen-denominated borrowings by Nagoya Electric
Light (in 1907), Hakata Electric (in 1910), and Kinugawa Electric (in 1911).
Notes to Chapter 3, Pages 120“121

The ¬rst of these borrowings was from an unidenti¬ed London syndicate. The
other two were from two trading companies: Sale & Frazar and M. Samuel &
Co. See Harumi Matsushimi, ˜˜The Historical Importance of the Flotation of
the Foreign Loan of the Power Industry,™™ [Denryoku Gaisai no Rekishiteki Igi]
in The Socio-Economic History [Shakai Kezigaku], 16“6 (1961), 95. Yumiko
Morii provided the translation. On Sale & Frazar history, see Lockwood,
Economic Development of Japan, 329“30. Frazar & Co., the long-established
U.S. trading house, traded under the name Sale & Frazar from 1902 to 1927.
M. Samuel & Co. was a British trading company qua merchant bank. On the
latter, see Jones, Merchants to Multinationals, 73. With foreign ¬nancing
lacking and domestic ¬nance substituted, the Japanese made important strides
in electri¬cation before World War I.
As indicated above, others believed there were some sizable foreign direct
investments, so the term ˜˜by our de¬nition™™ is key here. Aside from those
investments earlier mentioned, we have identi¬ed some small foreign direct
investments in power facilities, but the output of these plants was so limited
relative to the total output of U.S. electric utilities that one could justify the
statement that there was ˜˜virtually no™™ inward foreign direct investment.
On the outward investments of U.S. electrical manufacturers, see Wilkins,
Emergence of Multinational Enterprise. On an explanation of extended
manufacturers™ satellites, see Chapter 2, herein.
See Hausman, ˜˜Historical Antecedents,™™ 31“33. As noted above, in 1905 it
already had interests in ¬ve foreign companies. This was nothing compared
with what would follow.
On the spillover, see Wilkins, Emergence of Multinational Enterprise.
The story of the Morgan-Yerkes rivalry over investments in the London
˜˜tube™™ made for high drama. In the view of many individuals in Great Britain,
˜˜American capital was taking over.™™ In 1901“1902, J. P. Morgan (New York)
with J. S. Morgan (London) competed with Chicago traction giant Charles
T. Yerkes, backed by Speyer & Co. (New York) and Edgar Speyer in London,
to ¬nance the London underground. Yerkes won out. Securities were issued,
and in 1903 alone the Underground Electric Railways of London received
some $17 million in U.S. ¬nancing “ a huge sum for that period. Only about
one-quarter of the original shares of the Underground Electric Railways of
London were sold in Great Britain. Yerkes was said to have invested
˜˜millions™™ of his own money with no returns. As a consequence of this contest
for leadership in the ¬nancing, the unending distrust by the Morgans of the
Speyer house was forti¬ed; J. P. Morgan called Speyer™s rivalry on this occasion
the ˜˜greatest rascality and conspiracy I ever heard of.™™ The press in London
and New York carried the story. On Yerkes™s victory, see New York Times,
Oct. 22, 1902; Chernow, The House of Morgan, 100; Lewis, America™s Stake,
340 (Lewis considers the $17 million a portfolio investment); Byatt, British
Electrical Industry, 7 (on original shares); A. Emil Davies, Investments Abroad
(Chicago: A.W. Shaw Co., 1927), 49 (on Yerkes™s absence of return on his
investments); and Hughes, Networks of Power, 206, 221 (on Yerkes in
Chicago). The hostility of the House of Morgan to that of Speyer is evident in
every study of Morgan. See, for example, Chernow, The House of Morgan, 74.
Notes to Chapter 3, Pages 121“122 369

The ˜˜rascality™™ quotation is from Kynaston, City of London, II, 352. John
H. Dunning, American Investment in British Manufacturing Industry, rev. ed.
(New York: Routledge, 1998), 13, says British Thomson-Houston (GE™s
British manufacturing af¬liate) supplied a major part of the electrical
equipment for the London Underground Railway (and also for ˜˜more than
¬fty tramways systems™™ in the United Kingdom). Thus, even though Morgan
lost out in the ¬nancing, a GE af¬liate got the orders. Was Yerkes a direct
investor? There is a possible argument for that view. We do not know how
long the investment lasted.
For example, the U.S. interests in the Shawingan Water & Power Co. in
Quebec, the Canadian Niagara Power Company and Ontario Power Company
in Ontario, and British interests in the British Columbia Electric Railway, in
British Columbia.
We have discussed above the Canadian (and English) interests in Mexico. For
material on the Canadians in Brazil, see Armstrong and Nelles, Southern
Exposure; McDowall, Light; Halsey, Investments in Latin America, 164“67.
On the British free standing companies in Brazil, there was, for example, the
Southern Brazil Electric Co., registered in 1913. Charles Franklin Mallory,
˜˜Financial Problems of the North American Owned Electrical Utilities in Latin
America,™™ MA Thesis, MIT, 1956, 86, and FTC Report, II, 544. Other British
foreign direct investments in light and power in Brazil by the eve of World War
I included those made by the British-registered Ceara Tramways, Light &
Power Co. Ltd., Minas Gerais Electric Light & Tramway Co. Ltd., Manaos
Tramway & Light Co. Ltd., and Pernambuco Tramways & Power Co. Ltd.
Ibid., II, 544“45; Brazilian Traction, Light and Power Co. was formed in 1912.
Halsey, Investments in Latin America, 168“69, 171, and Allen Morrison,
˜˜The Tramways of Manaus, Amazonas state Brazil,™™ [n.d.] (http://www.
tramz.com/br/mn/mn.html, accessed March 13, 2006).
Jones and Greenhill, ˜˜Public Utility Companies,™™ 81, and Rippy, British
Investments in Latin America, 242. These ¬rms in the main appear to be
foreign direct investments. Considerable information on British (and other
foreign) investments in tramways in a number of Latin American countries is
available on the website of Allen Morrison (http://www.tramz.com/index.
html, accessed Sept. 26, 2007).
It is not clear whether Yerkes™s earlier investment in the London underground
(see above in this chapter) still remained in 1913“1914. Other inward
investments consisted of extended foreign manufacturers™ satellites and also
investments that passed through the United Kingdom “ that is, were in
companies that in turn invested abroad. Leslie Hannah, Electricity Before
Nationalisation (Baltimore: Johns Hopkins University Press, 1979), 71, refers
to George Balfour as commercial manager of an unnamed American electric
utility operating in Britain in 1902. We think this would go into the category
of ˜˜extended foreign manufacturers™ satellite™™ and was associated with the
large Westinghouse manufacturing operation in the United Kingdom. The
Westinghouse af¬liate Traction and Power Securities Co. was ¬nancing
the Mersey Railway electri¬cation at this time, for which power facilities had
been created. See John Dummelow, ˜˜Metropolitan-Vickers Electrical Co. Ltd.,
Notes to Chapter 3, Pages 122“123

1899“1949™™ (http://homepage.ntlworld.com/jim.lawton1/index.htm, accessed
Oct. 25, 2005).
John M. Coatsworth and Alan M. Taylor, eds., Latin America and the World
Economy Since 1800 (Cambridge, MA: Harvard University Press, 1998), 141,
Halsey, Investments in Latin America (for overview of foreign investments in
public utilities in 1914). Halsey omits French ¬rms, but there was a French
contribution associated with French industrial investments “ isolated plants.
There were also some Italian investments, often associated with Swiss interests.
Rippy, British Investments in Latin America, 242; the Stock Exchange
Yearbook; and Garcke, 1914“1915 (on British investments in Latin American
utilities). Peter Hertner is doing major work on German investments in
Argentina: See his ˜˜German Foreign Investment in Electrical Industry and in
Electri¬ed Urban Transport in Italy, Spain, and Argentina until the end of the
1920s: Some Preliminary Considerations,™™ unpublished paper, [2005]. We
used the pre“World War I exchange rate of 4.198 Marks to the dollar for the
The best description of the electrical industry in China at the eve of World War
I is in Garcke, 1914“1915, 98“100. These pages discuss the French central
station in the French concessions in Shanghai and Tientsin (now Tianjin) (that
´ ´
of the Compagnie Francaise de Tramways et d™Eclairage Electrique in
Shanghai) and the German stations at Tsingtau (now Qingdao) and Tsinanfu.
´ ´
On the Compagnie Francaise de Tramways et d™Eclairage Electrique de
Shanghai, see Damien Heurtebise, ˜˜L™Electri¬cation Outre-mer a Travers les
Fonds du Centre des Archives Diplomatique des Nantes,™™ in Barjot, et al., eds.,
L™Electri¬cation Outre-mer, 45, and ibid., 46 (for the electri¬cation of the
French concession in Tientsin, 1910“1925). According to Garcke, 1914“1915,
98“99, Chinese-owned power stations tended to be equipped with British,
French, or German machinery, often installed by trading companies of the
respective nationality. In British Hong Kong, Hong Kong Tramway Co. Ltd.
was registered in London. The large lighting and power station of Hong Kong
Electric Co., which was registered in Hong Kong, was equipped with English
machinery; as noted earlier, British trading company interests, namely, Gibb,
Livingston & Co. and Jardine Matheson, were closely associated with this
venture. China Light and Power with a concession in Kowloon was likewise
registered in Hong Kong. On So¬na™s interest (as of 1912) in Bangkok
tramways, see Ranieri, Dannie Heineman, 75.
The Japanese interests in China in electricity supply before 1914 were
exclusively in Manchuria. C. F. Remer, Foreign Investments in China (New
York: Macmillan, 1933), 427“30, 490; the South Manchuria Electric Company
(which would be organized in 1926) would take over the electric power plants
built earlier and once owned by the South Manchuria Railway. The process was
started by the railroad company; Japanese ownership would continue, including
both the railroad and the electricity supply company. The requirements of
running a railroad motivated the initiation by this railroad of its own power
See Table 3.1.
Notes to Chapter 4, Pages 123“129 371

218. The 1912 percentage was calculated by the authors from data in United States,
Bureau of the Census, Historical Statistics of the United States, Colonial Times
to 1957 (Washington, DC: USGPO, 1960), 15, 510. If the less than 25 percent
seems low, note that this includes all nonfarm households, encompassing those
in small towns and rural areas; we have not been able to locate ¬gures on the
electri¬cation of large-city urban households in the United States pre“World
War I, nor have we found comparable ¬gures for other countries. Figure 1.5,
Chapter 1, herein, suggests, however, that on the eve of World War I Canada,
Norway, and Switzerland (owing to their early development of hydroelectric
power and relatively small populations) had higher per capita electricity
output than the United States.

4 war, the ¬rst nationalization, restructuring,
and renewal, 1914“1929
1. The quote is from Mira Wilkins, The History of Foreign Investment in the
United States, 1914“1945 (Cambridge, MA: Harvard University Press, 2004), 4.
2. On the controversy, see ibid., 678n52.
3. We introduce this notion in relation to some holding companies. We will not
document this notion in other contexts here, although it seems to us to be
applicable in a number of settings.
4. Jonathan Coopersmith, ˜˜When Worlds Collide: Government and Electri¬cation,
1892“1939,™™ Business and Economic History, On-Line, 1 (2003), 12“13;
Jonathan Coopersmith, The Electri¬cation of Russia, 1880“1926 (Ithaca: Cornell
University Press, 1992), 103“4; Gerald D. Feldman, Army Industry and Labor in
Germany, 1914“1918 (Princeton: Princeton University Press, 1966) 254“55;
˜˜English Summary,™™ in Storia dell™ Industria Elettrica in Italia, vol. 2 (Rome-Bari:
Laterza, 1993), 949“53. W. Borgquist, ˜˜Regional Integration of Electric-Utility
Facilities,™™ Transactions, Third World Power Conference, vol. 7 (Washington,
DC: USGPO 1936), 679; Gunnar Nerheim, ˜˜The Development and Diffusion of
European Water Turbines, 1870“1920,™™ in Kristine Bruland, ed., Technology
Transfer and Scandinavian Industrialisation (New York: Berg, 1991), 355.
M. Banal, ˜˜L™Electricite Pendant la Premiere Guerre Mondiale,™™ in Histoire
´ `
´ lectricite en France, vol. I (Paris: Fayard, 1991), 901“6, and
Generale de l™E
´´ ´
G. Mori, ˜˜Le Guerre Parallele. L™Industria Elettrica in Italia nel Periodo della
Grande Guerra (1914“1919), in Il Capitalismo Industriale in Italia (Rome:
Editori Riuniti, 1977), 166“68.
5. Leslie Hannah, Electricity Before Nationalisation: A Study of the Development
of the Electricity Supply Industry in Britain to 1948 (Baltimore: Johns Hopkins
University Press, 1979), 53; Kakujiro Yamasaki and Gotaro Ogawa, The Effect
of the World War upon the Commerce and Industry of Japan (New Haven: Yale
University Press, 1929), 336.
6. Charles Keller, Power Situation During the War (Washington, DC, 1921),
17“18, 46. Federal government spending rose from 1.5 percent of the U.S. GNP
in 1916 (before U.S. entry) to 24.2 percent of U.S. GNP in 1918 (the last year of
the war); on textbook treatment of U.S. government involvement in general, see,
for one example among many, Gary M. Walton and Hugh Rockoff, History of
Notes to Chapter 4, Pages 129“131

the American Economy, 10th ed. (n.p.: South-Western/Thomson Learning,
2005), 418, 421“24.
Williams Haynes, American Chemical Industry, 6 vol. (New York: Van
Nostrand, 1945“1953), II, 90“111, and Thomas P. Hughes, Networks of
Power (Baltimore: Johns Hopkins University Press, 1983), 287 (on the U.S.
government nitrate program). The German government provided ¬nancial
security for the construction and operation of two large lignite plants for ¬xing
nitrogen from the air. Ibid., 287“89.
Hannah, Electricity Before Nationalisation, 53“57.
See H. V. Nelles, The Politics of Development (Toronto: Macmillan, 1974),
227; Edward Dean Adams, Niagara Power. History of Niagara Falls Power
Company, 2 vol. (Niagara Falls, NY: Niagara Falls Power Co., 1927), II, 81.
Christopher Armstrong and H. V. Nelles, Monopoly™s Moment: The Organiza-
tion and Regulation of Canadian Utilities, 1830“1930 (Philadelphia: Temple
University Press, 1986), 207“10, 254“60 (on BCER™s experience with
David Massell, Amassing Power: J. B. Duke and the Saguenay River, 1897“1927
(Montreal: McGill-Queen™s University Press, 2000), 147.
L. de Verebely, ˜˜National and Regional Planning and Their Relation to the
Conservation of Natural Resources: Regional Integration of Electric-Utility
Facilities,™™ Transactions, Third World Power Conference, vol. 6 (Washington,
DC: USGPO, 1936), 409.
Keller, Power Situation During the War, 46, 102“280.
As one example, ˜˜In 1920 Lenin de¬ned communism as ˜Soviet power plus the
electri¬cation of the whole country.™™™ ˜˜Energy Survey,™™ Economist (June 18,
1994), 6.
Wilkins, History . . . 1914“1945, 109; see also 41 U.S. Stat. 1065 for the
relevant section of the act.
Raphael Schapiro, ˜˜Public Ownership and Private Investment: The Case of
British Electric Traction,™™ in his ˜˜Why Public Ownership? Urban Utilities
in London, 1870“1914,™™ D.Phil. thesis, Nuf¬eld College, Oxford University,
June 2003, 223.
Alex Hunter, The Economics of Australian Industry (Melbourne: Melbourne
University Press, 1963), 131.
Schapiro, ˜˜Public Ownership and Private Investment,™™ 225. The actual
reincorporation with Indian registration appears to have taken place in 1920,
based on Garcke, 1928“1929, 1572.
Garcke, 1928“1929, 1576, 1588. The only difference in the names of the Hong
Kong companies was the 1922 addition of an ˜˜s™™ at the end of ˜˜Tramway.™™
The Hong Kong registration appears to have been for tax reasons.
Coopersmith, Electri¬cation of Russia, 104“6.
Later, as is well known, the Russian government called on foreign engineering
talent to help build up the industry, but no foreign investments were involved,
other than credits on equipment exports, which were not long-term foreign
investments. Even earlier, with the New Economic Policy in Russia, there was
some foreign investment allowed, but not in the electricity supply sector. The
large German activities in the Russian electrical industry in the interwar period,
Notes to Chapter 4, Pages 132“132 373

documented by Feldenkirchen, did not involve any long-term foreign direct
investments. See Wilfried Feldenkirchen, ˜˜Siemens in Eastern Europe: From the
End of World War I to the End of World War II,™™ in Christopher Kobrak and
Per H. Hansen, eds., European Business, Dictatorship, and Political Risk,
1920“1945 (New York: Berghahn Books, 2004), 126“35. See Coopersmith,
Electri¬cation of Russia, 227, on the absence of foreign investment in contrast
with the prewar years.
This happened on both sides of the war. See Mira Wilkins, The Maturing of
Multinational Enterprise: American Business Abroad from 1914 to 1970
(Cambridge, MA: Harvard University Press, 1974), 23“24, 40“42, on the
takeovers of U.S. properties in Germany, which were far smaller in size than
German properties in the United States. Wilkins, The History . . . 1914“1945,
Ch. 1, on the takeover of enemy assets in the United States.
Wilfried Feldenkirchen, Siemens: From Workshop to Global Player (Munich:
Piper, 2000), 110, 202; apparently, what English Electric acquired from
Siemens within England was no bargain. The large Stafford factory had been
unpro¬table and underused. I. C. R. Byatt, The British Electrical Industry,
1875“1914 (Oxford: Clarendon Press, 1979), 194; Feldenkirchen, ˜˜Siemens in
Eastern Europe,™™ 126; Georg Siemens, History of the House of Siemens, 2 vol.
(Freiburg/Munich: Karl Alber, 1957), II, 24“26.
Feldenkirchen, ˜˜Siemens in Eastern Europe,™™ 126, 132. Construction of the
plant apparently did not start until 1925. For the progress, see Sigfrid von
Weiher and Herbert Goetzeler, The Siemens Company: Its Historical Role in
the Progess of Electrical Engineering, 1847“1980 (Berlin and Munich: Siemens
AG, 1977), 95. On the Shannon plant, see Harm Schroter, ˜˜The German
Question, the Uni¬cation of Europe, and European Market Strategies of
Germany™s Chemical and Electrical Industries, 1900“1992,™™ in Business
History Review, 67 (Autumn 1993), 382“83. Naturally, Siemens exported its
own equipment under the contractual arrangement.
See Chapter 3 for Hertner™s 16.5 percent estimate. On the ˜˜Italianized™™ foreign
capital, see Luciano Segreto, ˜˜Financing the Electric Industry in Europe
(1880“1945),™™ Unpublished paper presented in 1993 in Paris at a ˜˜pre-Milan-
conference™™ meeting (cited as Segreto, Milan paper). For details on foreign
capital in Italy before the ¬rst World War, Luciano Segreto, ˜˜Imprenditori e
Finanzieri,™™ in Storia dell™ Industria Elettrica in Italia, vol. 1 (Rome-Bari:
Laterza, 1992), 332. Hertner™s 16.5 percent estimate was that made directly
from Germany and not those made indirectly through Swiss holding
companies. For the Italianization process during the war, see Luciano Segreto
˜˜Gli Assetti Proprietari,™™ in Storia dell™ Industria Elettrica in Italia, vol. 3
(Rome-Bari: Laterza, 1993), 94“110, and his Giacinto Motta (Rome-Bari:
Laterza, 2005), 104“8.
German investments through Swiss holdings were not taken over. There was no
attempt here to cut through the corporate veils. Italian banks, electric, and/or
industrial ¬rms set up special holding companies for the con¬scated German
assets. These companies then were merged with Swiss holding companies, such
as Elektrobank and Indelec, to permit the latter to have the controlling interest
in the Italian holding company. Alternatively, in neutral Switzerland German
Notes to Chapter 4, Pages 133“133

and Italian electrical and ¬nancial groups met (discreetly) to develop strategies
to mitigate the German losses during the war. Segreto, ˜˜Gli Assetti
Proprietari,™™ 94“110, and his Giacinto Motta, 104“8 See also Pierre-Alain
Wavre, ˜˜Swiss Investments in Italy from the XVIIIth to the XXth Century,™™
Journal of European Economic History, 17 (Spring 1988), 96. Swiss holding
companies, however, with postwar Italian interests, including Elektrobank,
Indelec, Motor, and Italo-Suisse, would be negatively impacted when in 1921
the Italian lire was devalued. Luciano Segreto, ˜˜Du ˜Made in Germany™ au
´ ´
˜Made In Switzerland,™™ in M. Trede, ed., Electricite et Electri¬cation dans le
´´ ´
Monde 1880“1980 (Paris: PUF, 1992), 350.
27. Hans-Peter Schwarz, Konrad Adenauer, vol. 1 (Providence, RI: Berghahn
Books, 1995), 120 (the quote). Rene Brion, ˜˜Le Role de la So¬na,™™ in Monique
´´ ˆ
Trede-Boulmer, ed., Le Financement de l™Industrie Electrique 1880“1980
(Paris: PUF, 1994), 217“20; Ginette Kurgan-Van Hentenryk™s data cited in
Herman Van der Wee and Monique Verbreyt, The Generale Bank 1822“1997
(Tielt, Belgium: Lannoo, 1997), 162; and Ginette Kurgan-Van Hentenryk to
Mira Wilkins, July 1, 2002. See also Liane Ranieri, Dannie Heineman: Un
Destin Singulier, 1872“1962 (Brussels: Editions Racine, 2005), 79“130 (on
Heineman and So¬na during World War I and its immediate aftermath; Ranieri
is good on Heineman and Belgian relief, ibid., 89ff). American-born Heineman
retained his U.S. citizenship. He was an exceptional individual. In February
1919, he published a plan for an International Clearing House and developed
his ¬rst ideas about international cooperation to deal with stabilization of
exchange rates, war debts, and the development of electrical networks. Brion,
˜˜Le Role de la So¬na,™™ 221. He became a very visible ¬gure. See, for example,
his discussion of the inef¬ciencies in the provision of electric power in London.
D. Heineman, ˜˜Electricity in the Region of London,™™ in Transactions of the
First World Power Conference, vol. 4 (London: Percy Lund Humphries & Co.,
1924), 1285“1305. On his title, see So¬na, Annual Reports.
28. See Chapter 3 herein. Gabriel Tortella, The Development of Modern Spain
(Cambridge, MA: Harvard University Press, 2000), 218; Teresa Tortella, A
Guide to Sources of Information on Foreign Investment in Spain, 1780“1914
(Amsterdam: International Institute of Social History, 2000) (http://www.iisg.
nl/publications/guide-spain.pdf, accessed Sept. 26, 2007). Speci¬cally on the
Barcelona companies, Christopher Armstrong and H. V. Nelles, Southern
Exposure: Canadian Promoters in Latin America and the Caribbean, 1896“
1930 (Toronto: University of Toronto Press, 1988), 163“67; Marco Doria and
Peter Hertner, ˜˜Urban Growth and the Creation of Integrated Electricity
Systems: The Cases Genoa and Barcelona, 1894“1914,™™ in Andrea Giuntini,
Peter Hertner, and Gregorio Nunez, eds., Urban Growth on Two Continents in
the 19th and 20th Centuries: Technology, Networks, Finance and Public
Regulation (Granada: Editorial Comares, 2004), 241; and Peter Hertner and
H. V. Nelles, ˜˜Contrasting Styles of Foreign Investment: A Comparison of the
Entrepreneurship, Technology, and Finance of German and Canadian
Enterprises in Barcelona Electri¬cation,™™ Revue Economique, 58 (Jan. 2007),
191“214. Elektrobank and Indelec both had investments in Spain. In 1905,
So¬na had created in Spain the Tramways de Barcelone and in 1906 Tramways
Notes to Chapter 4, Pages 133“134 375

et Electricite de Bilbao. When So¬na sold its interests in 1913 in the Tramways
de Barcelone to Barcelona Traction, Light and Power Co., it got stock as
collateral for the tramway company™s debt to So¬na; after the December 1914
bankruptcy of BTLP, So¬na obtained an interest in BTLP. Ranieri, Dannie
Heineman, 74, 122.
Armstrong and Nelles, Southern Exposure, 257. Loewenstein had no known
German ties.
Armstrong and Nelles, Southern Exposure, 167; Doria and Hertner, ˜˜Urban
Growth,™™ 243; and Hertner and Nelles, ˜˜Contrasting Styles,™™ which is
wonderful on the troubles with the ¬nancing.
Doria and Hertner, ˜˜Urban Growth,™™ 242“43, explain that Ebro, founded in
Canada at the same time as BTLP (1911) and then registered in Spain, was the
main producing company, while BTLP served as the principal holding company
for the electricity and transport ¬rms that it acquired in Catalonia. According
to Tortella, Guide to Sources of Information on Foreign Investment in Spain,
item 410: Riegos y Fuerza del Ebro, Ebro was at origin a wholly owned
subsidiary of BTLP.
Peacock, who became president of Barcelona Traction in 1915, resided in
London; he was the London representative of the Toronto-headquartered
Dominion Securities from 1902 to 1915. Peacock developed a close, informal
relationship with Barings and was considered by them to be a specialist on
electric utility enterprises in Brazil, Mexico, and Spain (that is, the Canadian
activities). He would serve as a director of the Bank of England from 1921 until
1924, when he became a partner in the Barings merchant bank. (In 1924,
Barings had a director on the Bank of England board; not until that man died
did Peacock again, in 1929, become a Bank of England board member.)
For background on Peacock, see Carroll Quigley, The Anglo-American
Establishment: From Rhodes to Cliveden (New York: Books in Focus, 1981),
87 (which has a number of mistakes, but is good on context); Wilkins,
History . . . 1914“1945, 489, 848n250; and Duncan McDowall, The Light:
Brazilian Traction, Light and Power Company Limited, 1899“1945 (Toronto:
University of Toronto Press, 1988), 212.
Hertner and Nelles, ˜˜Contrasting Styles,™™ 16.
Armstrong and Nelles, Southern Exposure, 232.
Ibid., 232, 238, 240, 280 (on Asa Billings and Pearson Engineering). After the
bankruptcy of Barcelona Traction in December 1914, it was already clear, even
before the sinking of the Lusitania, that F. S. Pearson ˜˜would have to be
dislodged™™ from the management; thus, Peacock had in 1915 become president
of Barcelona Traction. McDowall, The Light, 212.
David Kynaston, The City of London (London: Chatto & Windus, 1999),
III, 145.
The quoted passage was Edward Peacock™s assessment in 1926. See Wilkins,
History . . . 1914“1945, 198.
Armstrong and Nelles, Southern Exposure, 232, and Albert Broder, Alcatel
Alsthom: Histoire de la Compagnie Generale d™Electricite (Paris: Larousse,
´´ ´
1992), 88. On Energ±a Electrica de Cataluna, see Chapter 3 herein.
´ ´ ˜
Armstrong and Nelles, Southern Exposure, 258“59.
Notes to Chapter 4, Pages 134“135

40. Hertner and Nelles, ˜˜Contrasting Styles,™™ 16; its sister company Ebro became
the most important hydroelectric producer in Spain. Doria and Hertner,
˜˜Urban Growth,™™ 242.
41. Lothar Gall, et al., The Deutsche Bank, 1870“1995 (London: Weidenfeld &
Nicholson, 1995), 182.
42. R. P. T. Davenport-Hines, Dudley Docker (Cambridge: Cambridge University
Press, 1984), 200. Was this in part disingenuous? In August 1920, Walther
Rathenau of AEG told General Electric (U.S.) men that he intended to take
advantage of the depreciated Mark to reconquer export markets. Stephen A.
Schuker, American ˜˜Reparations™™ to Germany, 1919“33 (Princeton: Princeton
Studies in International Finance, No. 61, Department of Economics, Princeton
University, 1988), 21. Of course, there is a difference between trade and
investment; AEG and Siemens both wanted to export.
43. Davenport-Hines, Dudley Docker, 155“58.
44. Hubert Herring, A History of Latin America (New York: Knopf, 1961), 667,
and David R. Moore, A History of Latin America, rev. ed. (New York:
Prentice-Hall, 1942), 489“94, 817“18.
45. Ibid., 817“18.
46. Gall, et al., Deutsche Bank, 183; Albert Carreras, Xavier Tafunnell, and
Eugenio Torres, ˜˜Against Integration: The Rise and Decline of Spanish State-
Owned Firms and the Decline and Rise of Multinationals, 1939“1990,™™ in Ulf
Olsson, ed., Business and European Integration Since 1800 (Goteborg, Sweden:
Graphic Systems, 1997), 44. Banco Urquijo, incorporated in 1918 (on the basis
of an old banking house), was in the 1920s one of Spain™s six largest banks; it
was involved in ˜˜mixed banking, in the style of the German ˜universal™ banks;™™
it was a commercial bank, which also undertook promotional and holding
activities; it became very much involved in public utilities ¬nance within Spain
(and abroad). Handbook on the History of European Banks, 868“69.
47. On the Argentinean, Chilean, and Uruguayan properties of DUEG/CATE (at
the end of 1917), see Frederic M. Halsey, Investments in Latin America and the
British West Indies (U.S. Department of Commerce, Bureau of Foreign and
Domestic Commerce, Special Agents Series, No. 169, Washington, DC, 1918),
68“69, 364. CHADE would not acquire the largest of the German-owned
Chilean properties (see data later in the present chapter; these had not been
owned by DUEG before the war). In 1920 in Argentina, the DUEG counterpart
name CATE was also dropped. The company was known in Argentina as
CHADE or, over time, by its principal subsidiary™s name, Compan±a Argentina
de Electricidad, abbreviated as CAE or, later, CADE. CAE had been formed as
an Argentine company in 1909; DUEG had acquired part of the stock, which
passed to CHADE in the 1920 transition. CAE initially operated in the Province
of Buenos Aires, north of the capital. In the 1920s, CAE/CADE appears to have
become the main operating company of CHADE in Argentina. We are indebted
to Norma Lanciotti (November 2006) for this information. Maria Ines
Barbero, ˜˜Grupos Empresarios, Intercambio Comercial e Inversiones Italianas
en la Argentina,™™ Estudios Migratorios Latinoamericanos, 5:1990), 324,
mentions CAE.
48. Gall, et al., Deutsche Bank, 183.
Notes to Chapter 4, Pages 136“138 377

49. The dif¬culties were not con¬ned to the German-Swiss ¬rms. On Elektrobank
and Indelec pre-war investments in Germany, see Chapter 3. The holding
companies™ dif¬culties were compounded when in 1921 the Italian lire was
50. Gall, et al., Deutsche Bank, 183.
51. Luciano Segreto, ˜˜Financing the Electric Industry Worldwide: Strategy and
Structure of the Swiss Electric Holding Companies, 1895“1945,™™ Business and
Economic History, 23 (Fall 1994), 167“68.
´ ´
52. Serge Paquier, Histoire de l™Electricite en Suisse (Geneva: Editions Passe
´ ´
Present, 1998), II, 978. More accurately than Paquier, Peter Hertner notes the
curtailed in¬‚uence of AEG and Siemens in Elektrobank and Indelec; their
participation in the capital was lowered in each of the two cases to less than
25 percent of the equity. Peter Hertner, ˜˜L™Industrie Electrotechnique
` la Recherche d™une Position International
Allemande entre les Deux Guerres: A
Perdue,™™ Relations Internationales, 43 (Autumn 1985), 299.
53. A Credit Suisse historian writes that in the spring of 1920 Credit Suisse and
Elektrobank ˜˜participated in the transfer™™ of DUEG to So¬na and in the
creation of CHADE. Joseph Jung, From Schweizerische Kreditanstalt to Credit
Suisse Group: The History of a Bank (Zurich: NZZ Verlag, 2000), 73.
54. On Motor and Columbus, see Chapter 3; on Motor-Columbus and its
predecessors, Paquier, Histoire de l™Electricite en Suisse, II, 691“92, 771“72;
Segreto, ˜˜Du ˜Made in Germany,™™™ 349, and Segreto, ˜˜Financing the Electric
Industry Worldwide,™™ 167. On Italo-Argentina™s investments in Argentina
during World War I, see Halsey, Investments in Latin America, 68“69.
Although Italo-Argentina would expand during the 1920s, it remained small
compared with CHADE.
55. Brion, ˜˜Le Role de la So¬na,™™ 220, for So¬na™s working out of its problems
with French sequestrations during the war years. Luciano Segreto, ˜˜Le Role du ˆ
´ tranger dans l™Industrie Electrique,™™ in Maurice Levy-Leboyer and
Capital E ´
´ lectricite en France, II (Paris:
Henri Morsel, eds., Histoire Generale de l™E
´´ ´
Fayard, 1994), 982“1014 (on Elektrobank as well as the other Swiss
56. Pierre Lanthier ˜˜Les Constructions Electriques en France: Le Case de Six
Groupes Industriels Internationaux de 1880 a 1940,™™ Ph.D. diss., 3 vol., Paris:
University of Paris X (Nanterre), 1988. So¬na™s investments in France were
mainly concentrated in SCIE, while becoming a strong partner of Ernest Mercier
(a shareholder in SCIE). Among its overseas interests, SCIE was involved in
Algeria and French Indo-China. Segreto, ˜˜Le Role du Capital Etranger dans
´ lectrique,™™ 1006“10.
l™Industrie E
57. The three properties that were transferred were in Turku, Maarianhamina,
and Hameenlinna. Timo Myllyntaus, Electrifying Finland: The Transfer of a
New Technology into a Late Industrializing Economy (London: Macmillan,
1991), 56.
58. On Elektrobank™s experiences, see Segreto, ˜˜Le Role du Capital Etranger dans
´ lectrique,™™ 991“92.
l™Industrie E
59. See notes to Chapter 3 on the investments of Swiss Bankverein (as of 1917
Swiss Bank Corporation) in the Austro-Hungarian Empire and the then existing
Notes to Chapter 4, Pages 138“139

corporate structure. In 1923, SBC set up the holding company Elektrowerte AG
to consolidate the main assets of its af¬liated railroad bank (Schweizerische
Eisenbahnbank) that were located in the former Austro-Hungarian Empire;
Elektrowerte took over Steiermarkishe Elektrizitats-Gesellschaft (in English,
¨ ¨
Steiermark Electric Power Co.), which just before World War I had built the
Fala electricity works, in what would become Yugoslavia. SBC™s railroad bank
was renamed in 1924: Schweizerische Elektrizitats- und Verkehrsgesellschaft
(Suiselectra). See Bauer, Swiss Bank Corporation, 162“63, 249, 393.
Nikos Pantelakis, The Electri¬cation of Greece: From Private Initiative to State
Monopoly (1889“1956) (Athens: Cultural Foundation of the National Bank of
Greece, 1991), 177“78, 212 (in Greek, with relevant portions translated for us
by the author). English summary, Ten Years of Electricity, 1926“1936 (Athens
Piraeus Electricity Company Ltd.), in PEA/COWD 3/3, S. Pearson & Son
Papers, Science Museum, London; and British Electrical and Allied Manufac-
turers™ Association, Combines and Trusts in the Electrical Industry. The
Position in Europe in 1927 (1927; reprinted, New York: Arno Press, 1977),
180, con¬rms the continuing French Thomson“Houston connection. This book
is henceforth cited as BEAM, Combines.
In 1923, the Government of South Africa created (under legislation passed in
1922) an Electricity Supply Commission (Escom) to operate and expand
electricity supply undertakings. For conditions in South Africa, see Catherine
Coquery-Vidrovitch, ˜˜La Politique de Reseaux d™Electri¬cation en Afrique:
Comparison Afrique de l™Ouest, Afrique du Sud,™™ in Dominique Barjot, Daniel
Lefeuvre, Arnaud Berthonnet, and Sophie Coeure, eds., L™Electri¬cation Outre-
mer de la Fin du XIXe Siecle aux Premiere Decolonisations (Paris: EDF, 2002),
` ` ´
´ lectrique Destinee a las Miniere en
77; and Celine Boileau, ˜˜La Production E
´ ´` `
Afrique du Sud (1880“1922),™™ in ibid., 470“71, which explains the
complicated relationship between VFTP and Escom. See also Charles H.
Feinstein, An Economic History of South Africa (Cambridge: Cambridge
University Press, 2005), 120, on Escom. Stock Exchange Year Book 1930,
See Chapter 3. See also Linda Jones, Charles Jones, and Robert Greenhill,
˜˜Public Utility Companies,™™ in D. C. M. Platt, Business Imperialism 1840“1930:
An Inquiry Based on British Experience in Latin America (Oxford: Oxford
University Press, 1977), 80. Pearson™s Vera Cruz Light & Power was one of the
many foreign companies that suffered ¬nancial losses in certain years of the
revolution but persisted. Miguel S. Wionczek, ˜˜Electric Power,™™ in Raymond
Vernon, ed., Public Policy and Private Enterprise in Mexico (Cambridge, MA:
Harvard University Press, 1964), 35.
Jones and Greenhill, ˜˜Public Utility Companies, 94“95.
David Kynaston, The City of London (London: Chatto & Windus, 1995), II,
404; in the notes to Chapter 3, we indicated that Beit died in 1906 and Wernher
in 1912. We cannot ¬nd any evidence that the British Pearson group had been
involved in South Africa before or after World War I. However, there does
seem to have been some international business links “ if nothing more than on
an information basis “ between the Victoria Falls developments and those in
Chile. Maryna Fraser, ˜˜International Archives in South Africa,™™ Business and
Notes to Chapter 4, Pages 140“141 379

Economic History, 2nd ser., XVI (1987), 163“73, describes the Corner House
group: Werner Beit & Co., London; the Johannesburg House of H. Eckstein &
Co. and its subsidiary Rand Mines Ltd.; and the Central Mining and
Investment Corporation. Also CMIC had been involved with S. Pearson &
Son in 1914, seeking oil concessions in what is now Iraq. See Marian Kent, Oil
and Empire: British Policy and Mesopotamian Oil 1900“1920 (London:
Macmillan, 1976), 88, 234n124.
Jones and Greenhill, ˜˜Public Utility Companies,™™ 95“101.
Wilkins, History . . . 1914“1945, 766n389; on Kindersley, see Kynaston, City
of London, III, 73, and R. S. Sayers, The Bank of England, 1891“1944, 2 vol.
(Cambridge: Cambridge University Press, 1976), I, 122n4. Kindersley was a
director of the Bank of England (1914“1946).
On Brand, see Quigley, Anglo-American Establishment, 60, and Sayers, Bank
of England, I, 153n, 157n, 178n, and II, 363“364n5.
Kynaston, City of London, III, 38.
Ibid., 40. Had British electri¬cation at home (as well as abroad) fallen behind
because of the absence of ˜˜universal banks™™? For some thoughts on the
progress of U.K. domestic electri¬cation, see Michael Edelstein, Overseas
Investment in the Age of High Imperialism: The United Kingdom, 1850“1914
(New York: Columbia University Press, 1982), 64“65. Edelstein did not ¬nd
this absence responsible.
J. A. Spender, Weetman Pearson: First Viscount Cowdray, 1856“1927
(London: Cassell & Co., 1930), 249, 270 (quote).
See data in S. Pearson & Son Papers, Science Museum Library, London. At
origin, Whitehall Securities owned all the ordinary shares of Whitehall Electric
and S. Pearson & Son controlled Whitehall Securities; Jones and Greenhill,
˜˜Public Utility Companies,™™ 102 (on the 1922 situation); in 1933, when we
have detailed evidence, Whitehall Securities, still controlled by the group,
continued to own all the ordinary share capital of Whitehall Electric; see
Deloitte™s Valuation, S. Pearson & Son Ltd., Whitehall Securities Corporation
Ltd. and subsidiaries, Oct. 5, 1933, material submitted with letter dated March
16, 1936, in PEA/COWD 5/11, Pearson papers. See also Jones and Greenhill,
˜˜Public Utility Companies,™™ 102“14; J. Fred Rippy, British Investments in
Latin America, 1822“1949 (Minneapolis: University of Minnesota Press,
1959), 245, and Spender, Weetman Pearson, 208, 248“49.
Kynaston, City of London, III, 73.
The Belgian branch was in Brussels. According to Bank of Spain records, the
Spanish branch was in Madrid. We are indebted to Teresa Tortella, who sent us
(September 30, 2005), from the Bank of Spain Archives, a copy of the
˜˜settlement deed™™ for Lazard Brothers™ new Spanish ¬rm, set up in 1920; it had
a broad mandate: It could engage in ˜˜toda clase de asuntos industriales y
mercantiles, especialmente comerciales y de Banca, pero sin excluir ninguna
clase de negocios, pudiendo adquirir negocios, bienes y derechos de toda clase
sin limitacion alguna™™ (all classes of industrial and mercantile business,
especially commercial and of the Bank, but without excluding any class of
business, being able to acquire businesses, assets and rights of all types without
any limitation).
Notes to Chapter 4, Pages 141“143

74. Davenport-Hines, Dudley Docker, 206. The links between the Docker and the
British Pearson groups were not harbingers for the future. Often, these two
British groups proved to be rivals, with the Pearsons associated, for example,
with English Electric, while the Docker group sought business for Metropolitan
Vickers and related British companies. In 1925, however, Sir Clarendon Hyde
(who was a part of the British Pearson business cluster) joined the board of
Elra¬n after the death of Sir Edward Pearson. Ibid. See notes later in this
chapter on Hyde. It was Docker who seems to have had the strongest So¬na
connections, although see (in a note below) Lazard Brothers™ participation in
the ˜˜new™™ So¬na of 1928.
75. This loan appears to have been made in 1922. See Garcke, 1928“1929,
1576“77. A 1922 £2 million ¬rst-debenture loan guaranteed by the British
government to the Newfoundland Power and Paper Co. was speci¬cally
designed to help the British manufacturer Armstrong, Whitworth, which would
do the engineering work and supply turbines for the electrical facility. In 1921,
Armstrong, Whitworth had a minority interest in the predecessor of
Newfoundland Power and Paper, Newfoundland Products Corporation. W. J.
Reader, Bowater: A History (Cambridge: Cambridge University Press, 1981),
76. For a nice summary, see Sir Alec Cairncross, Control of Long-Term
International Capital Movements (Washington, DC: Brookings Institution,
1973), 56.
77. Ibid.
78. Kynaston, City of London, III, 85.
79. Sayers, Bank of England, I, 133 (˜˜taking some of the strain off London™™).
80. Charles H. Feinstein, Peter Temin, and Gianni Toniolo, ˜˜International
Economic Organization: Banking, Finance, and Trade in Europe Between the
Wars,™™ in Charles H. Feinstein, ed., Banking, Currency, and Finance in Europe
Between the Wars (Oxford: Oxford University Press, 1995), 9.
81. We did not include Puebla Tramway, Light & Power Co. Ltd., which was
Canadian-registered, but part of the Cowdray group. For the ¬rms, see Chapter 3
herein. For the 1919 reorganization of Mexican Northern Power Co., see
Armstrong and Nelles, Southern Exposure, 253.
82. Armstrong and Nelles, Southern Exposure, 207“26.
83. Ibid., 171.
84. Ibid., 178“79, 183, 184. The Brazilian milreis fell sharply in value in 1914“
1915, strengthened in 1916“1919, and then plunged in 1919“1923. Ibid., 230.
85. There had once been large German interests in the Brazilian electricity supply
industry (in Brasilianische Elektrizitats-Gesellschaft), but these had been sold to
a predecessor of Brazilian Traction in 1905. George F. W. Young, ˜˜German
banks and German direct investment in Latin America, 1880“1920,™™ in Carlos
Marichal, ed., Foreign Investment in Latin America: Impact on Economic
Development, 1850“1930 (Milan: Universita Bocconi, 1994), 60“61. By the
time of World War I, German interests in the Brazilian electricity supply
industry were negligible.
86. Armstrong and Nelles, Southern Exposure, 229. We have encountered Peacock
earlier in this chapter.
Notes to Chapter 4, Pages 143“145 381

87. On Dillon, Read, see Vincent P. Carosso, Investment Banking in America
(Cambridge, MA: Harvard University Press, 1970), 344, and Robert Sobel, The
Life and Times of Dillon Read (New York: Truman Talley Books, 1991).
88. Kynaston, City of London, III, 72.
89. Robert W. Dunn, American Foreign Investments (New York: B. W. Huebsch
and Viking , 1926), 57; because Dunn™s source is the Financial Post, Nov. 16,
1923, these ¬gures are probably in Canadian dollars.
90. Wilkins, Maturing of Multinational Enterprise, 43; in 1919, Vickers Ltd. acquired
Metropolitan Carriage and changed the name of British Westinghouse Electric to
Metropolitan Vickers Electrical Co. Ibid., 43n. On British Westinghouse™s
problems, see Byatt, British Electrical Industry, 1875“1914, 195. Ibid., 194,
found that British Thomson-Houston, GE™s af¬liate in the United Kingdom was
before the war an ef¬ciently run enterprise compared with British Westinghouse
and the British Siemens facilities. On GE™s expansion in the immediate postwar
years, see Wilkins, Maturing of Multinational Enterprise, 65“66.
91. William J. Hausman and John L. Neufeld, ˜˜U.S. Foreign Direct Investment in
Electrical Utilities in the 1920s,™™ in Mira Wilkins and Harm Schroter, eds., The
Free-Standing Company in the World Economy (Oxford: Oxford University
Press, 1998), 371“73; Gregory P. Marchildon, ˜˜The Montreal Engineering
Company and International Power: Overcoming the Limitations of the Free-
Standing Utility,™™ in ibid., 394“97 (on Cuba); Thomas O™Brien, The Century of
U.S. Capitalism in Latin America (Albuquerque: University of New Mexico
Press, 1999), 42“43 (Guatemala); Halsey, Investments in Latin America, 440,
writes that Electric Bond and Share made its initial acquisitions in Panama in
1916, rather than 1917; Wilkins, Maturing of Multinational Enterprise, 16,
says the actual purchase was consummated in 1917; the property acquired was
that of the Panama-American Corporation, originally set up in 1904. Halsey,
Investments in Latin America, 440; Moore, History of Latin America, 817“18.
We have no evidence of pre“World War I German ownership of the
Panamanian properties, but the State Department did not want to take
chances. For national security reasons, it wanted a strong American presence
near the Panama Canal. On the German activities in Guatemala in
electri¬cation, see Regina Wagner, ˜˜Actividades Empresariales de los Alemanes
en Guatemala, 1850“1920,™™ Mesoamerica, 13 (June 1987), 114, 118, 120,
which does not get the story exactly right. On the ostensible German interests
in Havana Electric, through Speyer & Co., New York, see Sidney Alexander
Mitchell, S. Z. Mitchell and the Electrical Industry (New York: Farrar, Straus &
Cudahy, 1960), 108.
92. This was an area of Brazil where there had been strong German in¬‚uences.
93. American & Foreign Power Co., ˜˜The Foreign Power System,™™ booklet (New
York: American & Foreign Power Co., 1953), 8; Wilkins, Maturing of
Multinational Enterprise, 131.
94. Wilkins, Maturing of Multinational Enterprise, 20“22; Marc Linder, Projecting
Capitalism: A History of the Internationalization of the Construction Industry
(Westport, CT: Greenwood Press, 1994), 107“9; and Hausman and Neufeld,
˜˜U.S. Foreign Direct Investment,™™ 377 (on Charles Stone and Stone &
Notes to Chapter 4, Pages 145“147

95. Moody™s Manual (Utilities) 1930, xxi. This ¬gure was up substantially from
before World War I, but there was still a long way to go with U.S. as well as
global electri¬cation.
96. Based on research by Mira Wilkins for her Maturing of Multinational
Enterprise. See also, Dominique Barjot, Daniel Lefeuvre, Arnaud Berthonnet,
and Sophie Coeure, eds., L™Electri¬cation Outre-mer de la Fin du XIXe
Siecle aux Premiere Decolonisations (Paris: EDF, 2002), passim. There
` ` ´
are numerous discussions of company towns in standard business histories.
In the 1960s, Mira Wilkins visited about three dozen company towns in
Latin America, Africa, and the Middle East that had been established in the
97. Thomas Heinrich, ˜˜Product Diversi¬cation in the U.S. Pulp and Paper Industry:
The Case of International Paper, 1898“1941,™™ Business History Review, 75
(Autumn 2001), 479“83; Herbert Marshall, Frank A. Southard, and Kenneth
W. Taylor, Canadian-American Industry (1936; reprinted New York: Russell &
Russell, 1970), esp. 38, 40“43; and Hausman and Neufeld, ˜˜U.S. Foreign Direct
Investment,™™ 369, 381, 390n77. In Newfoundland, which did not join Canada
until 1949, the important Corner Brook company (as of 1922, Newfoundland
Power and Paper Co., then International Power and Paper Co. of Newfoundland,
later (1938) Bowater™s Newfoundland Pulp and Paper Mills Ltd.) had plans at
the start of the 1920s for a major hydroelectric facility and a large mill at Corner
Brook. The origins (the Newfoundland Products Corporation) were with the
Reid family of Newfoundland, which did not have the resources for such a large
project; a British group (including the manufacturer Armstrong, Whitworth) put
together the ¬nancial package. Then, in 1927 International Paper acquired
Newfoundland Power and Paper Co./International Power and Paper Co. of
Newfoundland. For the very complicated story, see Reader, Bowater, 33“36, 139
(International Paper™s 1927 acquisition). This acquisition by International Paper
in Newfoundland was in addition to those in Canada.
98. Hausman and Neufeld, ˜˜U.S. Foreign Direct Investment,™™ 383.
99. Later, we will note Alcoa™s Arthur Vining Davis as a participant in Italian
Power Co. and its successor, International Power Securities Corp., holding
companies related to Italian public utilities; Alcoa had no direct investments in
power facilities in Italy, but it had purchased in 1923 the power sites in Norway
and in 1925 in the French Pyrenees. Not long after, it built a small aluminum
plant in Italy. It wanted to be sure that it could gain access to adequate power.
Cleona Lewis, America™s Stake in International Investments (Washington, DC:
Brookings Institution, 1938), 248 (on Alcoa™s European holdings). For
background on Alcoa™s Canadian investments, Massell, Amassing Power,
170“89, with the terms of the 1925 arrangements on pp. 188“189; George
David Smith, From Monopoly to Competition: The Transformations of Alcoa,
1888“1986 (Cambridge: Cambridge University Press, 1988), 143“44. (The
Duke-Price Power Co had been formed in 1924, for the so-called upper
development. Massell, Amassing Power, 174.) For Andrew W. Mellon™s role in
˜˜actively assisting Alcoa™™ in its negotiations with Duke, see David Cannadine,
Mellon: An American Life (New York: Knopf, 2006), 323.
Notes to Chapter 4, Pages 148“149 383

100. Massell, Amassing Power, 5, 190“94. Isle Maligne was the so-called upper
101. Estimate made by William Hausman based on M. J. Patton, ˜˜The Water-
Power Resources of Canada,™™ Economic Geography, 2 (April 1926), 188, 190,
and Hausman and Neufeld, ˜˜U.S. Foreign Direct Investment,™™ 390n76.
102. A later Aluminium Ltd. report described the process: The holding company
Aluminium Ltd. was formed in Canada in 1928. At its inception, it acquired in
exchange for its own shares, equity interests in various companies owned by
Alcoa. The shares of Aluminium Ltd. were then immediately distributed as a
dividend to the shareholders of Alcoa, which meant that at the time of this
spin-off both Alcoa and Aluminium had identical shareholders. Aluminium
Ltd., ˜˜Prospectus,™™ July 4, 1963.
103. Wilkins, Maturing of Multinational Enterprise, 148“49; according to
Marshall, Southard, and Taylor, Canadian-American Industry, 105, within
Canada, in 1928 Alcoa ˜˜directly retained only the Alcoa Power Company
Ltd., owning the undeveloped site on the lower Saguenay.™™ The best discussion
of what was retained and what was not of the Saguenay project is in Brief of
the Aluminum Company in U.S. v. Aluminum Company of America, Equity
No. 85“83 (SDNY, 1940), 139“51, 187“91, 711“24; according to this brief,
the reason that the Lower Development (Alcoa Power Co. Ltd.) was not
transferred to Aluminium Ltd. in 1928 was that ˜˜The value of the property
was . . . so great that the surplus of Alcoa would not permit its transfer as part
of the reorganization and the ¬nances of Limited would not justify that
company™s acquiring the property.™™ By 1938, there was a new situation, and
Aluminium Ltd. paid $35 million for that property. Ibid., 723. The lower site
in 1925 was expected to have 780,000 potential horsepower, compared with
the upper development with its 400,000 horsepower. Ibid., 331.
104. After World War II, a U.S. antitrust suit would require the common
shareholders to choose and to maintain investments in one or the other
company; only then did the two companies become fully separate. Wilkins,
Maturing of Multinational Enterprise, 297.
105. Hausman and Neufeld, ˜˜U.S. Foreign Direct Investment,™™ 369.
106. Lewis, America™s Stake, 670.
107. See notes to Chapter 3 on the prewar situation. See also L. F. Haber, The
Chemical Industry, 1900“1930 (Oxford: Clarendon Press, 1971), 87, 126,
152, 168“69, 276, 286, and Jeffrey Allan Johnson, ˜˜The Power of Synthesis
(1900“1925),™™ in Werner Abelshauser, et al., German Industry and Global
Enterprise: BASF: The History of a Company (Cambridge: Cambridge
University Press, 2004), 144“45.
108. From 1925 through the rest of the 1930s, the German share of world exports in
electrotechnical products was the highest of any nation globally, even though as
a percentage of world exports of electrotechnical products, the share was
far lower than in 1913. Hertner, ˜˜L™Industrie Electrotechnique Allemande,™™
304. On the recovery of the German electrotechnical manufacturers, see ibid.,
289“304, and Feldenkirchen, ˜˜Siemens in Eastern Europe,™™ 126. By 1939
(regrettably, Feldenkirchen does not provide this information for 1929), Siemens
had once again a worldwide network “ outside of Germany within Europe and
Notes to Chapter 4, Pages 149“149

overseas “ employing 26,000 people. (This 1939 employment ¬gure is to be
compared with that of 1914, when Siemens had 24,606 employees in its foreign
establishments. Hertner, ˜˜L™Industrie Electrotechnique Allemande,™™ 292.) In
most countries of the world in 1939, Siemens had branch of¬ces. Its
international organization in 1939 consisted of almost 200 companies, of
which 109 were in Europe, 33 in Asia, 27 in Central and South America, 13 in
Africa, 10 in Australia and New Zealand, and 3 in the United States. Some of
these af¬liates had manufacturing plants. Most were designed to encourage
German exports and to aid in the offering of technical services. Feldenkirchen
does not, as noted, provide similar information for 1929, but he does indicate
that the process of reestablishing a Siemens presence was well underway by the
end of the 1920s, particularly in Bulgaria, Czechoslovakia, Hungary, Poland,
Romania, and Yugoslavia, where by the end of the 1920s. Siemens did have
local companies and factories that were established (or reestablished) ˜˜so that
the sale and at least partial production of goods was secured.™™ Feldenkirchen,
˜˜Siemens in Eastern Europe,™™ 135“45. Feldenkirchen does not provide any
information on Siemens™s investments in electric utilities. In 1928, Siemens set
up a branch in Egypt and began to compete for Egyptian business. Robert
Vitalis, When Capitalists Collide: Business Con¬‚ict and the End of Empire in
Egypt (Berkeley: University of California Press, 1995), 236“237n9, 71. There
seem to have been plans for some investments in utilities. For the international
investments of Siemens-Schuckert and Siemens & Halske in 1927, see BEAM,
Combines, 118“21. Harm Schroter, ˜˜The German Question, the Uni¬cation of
Europe, and European Market Strategies of Germany™s Chemical and Electrical
Industries, 1900“1992,™™ in Business History Review, 67 (Autumn 1993), 380“
86, is basically concerned with sales, technical services, and manufacturing
activities, not utilities. Schroter offers information on AEG, noting that AEG
had 35 sales/technical services of¬ces outside of Germany in 1930. Ibid., 383.
He, too, deals with Siemens™s expansion, adding material on its restoration of a
minority interest in Siemens Brothers, London, and its interest in two production
plants in Italy. The reestablishment of the minority interest in Siemens Brothers
in the United Kingdom in 1929 was in exchange for the latter™s shares in
Siemens & Halske, Berlin. (After World War I, as noted in the text, Siemens
Brothers, with its Woolwich factory, had kept the Siemens name but become
British-owned. The Stafford factory of the Siemens-Schuckert af¬liate in the
United Kingdom was what went to English Electric.) Siemens, History of the
House of Siemens, II, 204. For interests on boards of directors, we have relied on
Moody™s Manual, annual reports, and business histories.
109. For AEG™s indirect, usually minority, interests in electricity supply companies in
the late 1920s, we have relied on BEAM, Combines,137, and Frank Southard,
American Industry in Europe (Boston: Houghton Mif¬‚in, 1931), 207. In
Switzerland, AEG interests were in Kraftwerk Laufenburg; in Poland, in
Oberschlesische Kraftwerk, Katowice; in Turkey, in Societe des Tramways et de
l™Electricite de Constantinople; in Portugal in Compagnies Reunies Gaz et
´ ´
´ lectricite, Lisbon; and in Hungary, in AG fur Elektrischen und Verkehrsun-
E ´ ¨
ternehmungen and Phoebus AG fur Elektrische Unternehmungen, which two
companies were merged in 1926.
Notes to Chapter 4, Pages 149“150 385

110. Lewis, America™s Stake, 638“40.
111. On Siemens™s borrowings in the United States in 1925, see Dunn, American
Foreign Investments, 38, and in 1926, Wilkins, History . . . 1914“1945, 259.
On AEG borrowings in 1925, U.S. Senate, Committee on Finance, Sale of
Foreign Bonds, 72nd Cong., 1st sess. (1932), 107. The culmination of
Siemens™s borrowings came early in 1930, when Siemens & Halske issued a
1,000-year ˜˜participating debenture™™ (maturity date, 2930)! The par value of
this U.S. ¬‚otation was $23.5 million. This debenture had the same rate of
interest as the dividend rate on common shares. GE applied to the banking
group that handled the issue (Dillon, Read) for a block of the debentures
($11 million); the request was relayed to Siemens, which gave its consent.
Siemens wanted the foreign capital, without foreign in¬‚uence. GE got no voting
rights and did not get a membership on the Siemens board. United States
Department of Commerce, Bureau of Foreign and Domestic Commerce,
American Underwriting of Foreign Securities in 1930 (Washington, D.C.,
1931), 10, 18, 25, and Southard, American Industry in Europe, 26“27. We
provide more on the borrowings of Rhine-Westphalia Electric Power Company
(RWE) later; the Germans knew this company as Rheinisch-Westfa ¨lisches
Elektrizita¨tswerk and prefer the more accurate translation Rhenish-Westphalian
Electric Power; we used the translation adopted for American bond issues.
112. BEAM, Combines, 98.
113. Segreto, ˜˜Du ˜Made in Germany,™™™ 355. See Segreto, ˜˜Le Role du Capital
´ ´
Etranger dans l™Industrie Electrique,™™ 1002“6, for Indelec™s investments in
France. The Czechoslovakian investments were new. Alice Teichova reports
that Indelec had (as of December 31, 1937, but probably made in the 1920s) a
one-third participation in Severoceske Elektrarny (North Bohemian Electric
ˇ ´ ´
Power Works) in Podmokly. Alice Teichova, An Economic Background to
Munich: International Business and Czechoslovakia 1918“1938 (Cambridge:
Cambridge University Press, 1974), 220. BEAM, Combines, 160, con¬rms that
the investment was made in the 1920s, but there is no indication of output of
electricity as of 1927.
´ ´
114. See Segreto, ˜˜Le Role du Capital Etranger dans l™Industrie Electrique,™™ 991“
1002, for Elektrobank™s ˜˜new™™ French connections and the particular utilities
in which it was involved
115. Hughes, Networks of Power, 424; as our readers know, but as a reminder,
Elektrobank before the war had been AEG™s Swiss af¬liate; in Germany, the
Lahmeyer enterprise was associated with AEG. BEAM, Combines, 140.
116. Segreto, ˜˜Du ˜Made in Germany,™™™ 357, and Segreto,˜˜Financing the Electric
Industry Worldwide,™™ 168“69; Stock Exchange Year-Book 1930, 1025. By
1929, Schweizerisch-Amerikanische Elektrizitats-Gesellschaft (SAEG), with its
sister Swiss companies, owned the majority of the shares in Compan±a Italo-
Argentina de Electricidad (Italo-Argentine Electric Co.), incorporated in
Argentina in 1911; Empresas Electricas de Bahia Blanca (Bahia Blanca Electric
Co.), incorporated in Argentina in 1927; and Compan±a Americana de Luz y
Traccion, incorporated in Argentina 1918, which provided all the electric light
and power and street railway business in Asuncion, Paraguay, and operated
electric light and power and water service in the city of 25 de Mayo, Argentina.
Notes to Chapter 4, Pages 151“153

Ibid. For the increase in Italo-Argentina™s output in the 1920s, see the Wall
Street Journal, May 5, 1930.
Harm Schroter, ˜˜Globalization and Reliability: The Fate of Foreign Direct
Investment in Electric Power-Supply During the World Economic Crisis,
1929“1939,™™ Annales Historiques de l™Electricite, 4 (Nov. 2006), 117.
J. G. White & Co., which was in 1928 a subsidiary of a British company
and in 1929 once again became American-owned, was also involved in Foreign
Light & Power. For more on J. G. White, see later in this chapter.
Wavre, ˜˜Swiss Investments in Italy,™™ 85“102.
Segreto, ˜˜Du ˜Made in Germany,™™™ 357, corrected by the author, based on
data he collected in the Motor-Columbus archives. He insists that these are
rough estimates, for there is great dif¬culty in assembling these percentages,
owing to the holding and sub“holding companies, the networks, and the
partial interests.
On Franco-Suisse, see BEAM, Combines,159“60 (its interests in electricity
supply companies in 1927 in Switzerland, France, and Italy), and Segreto, ˜˜Le
Role du Capital Etranger,™™ 982“91. On Italo-Suisse: Wavre, ˜˜Swiss Invest-
ments,™™ 96; BEAM, Combines, 160; and Segreto, ˜˜Du ˜Made in Germany,™™™
350“52. In 1914, Motor had acquired an interest in Italo-Suisse; and after
the merger of Motor and Columbus in 1923, Italo-Suisse became closely
associated with Motor-Columbus. Franco-Suisse in the mid-1920s took part
with the French Petsche and Mercier groups in the formation of the French
holding company Union Financiere pour l™Industrie Electrique.
Rory Miller, ˜˜British Free-Standing Companies on the West Coast of South
America,™™ in Wilkins and Schroter, eds., Free-Standing Company in the World
Economy, 234 (on Lima Light). Richard Roberts, Schroders (Houndmills,
England: Macmillan, 1992), 139, 204“5 (on British registration, the 1910 and
the 1923 loans). The 1910 loan came a year before Schroder sponsored a loan
for the Peruvian government; the 1923 loan came a year after Schroder did just
that. The 1923 loan to Lima Light was at a time when British capital controls
were still in place, but that did not stop British government approval of some
Based on data in Miller, ˜˜British Free-Standing Companies,™™ 234, 250, and
BEAM, Combines, 182. According to the Stock Exchange Yearbook, 1934,
1856“57, the 1923 debenture issue was brought out simultaneously in London
and Switzerland, and of the £1.5 million, £250,000 was assigned to
Switzerland. Schroter, ˜˜Globalization and Reliability,™™ 118, identi¬ed the
Italian and Swiss interests as associated with Motor-Columbus.
Ranieri, Dannie Heineman, 131“80 (So¬na in the 1920s), ibid., 135“36 (the
scienti¬c laboratory); ibid., 138 (Giros), 231 (Argentina, 1928); Armstrong and
Nelles, Southern Exposure, 258“59 (overview of So¬na); Heineman, ˜˜Electricity
in the Region of London,™™ 1297 (on Argentina); BEAM, Combines, 154“56;
Moody™s Manual (Utilities) 1930, 2316“17, Brion, ˜˜Le Role de la So¬na,™™
221“25 (on So¬na™s activities in France and Societe Financiere Electrique);
´´ `
´ lectricite,™™ which we believe was
ibid., 224“25 (on ˜˜Societe Financiere d™E
´´ ` ´
a shortening of the name Societe Financiere pour le Developpement de
´´ ` ´
´ lectricite; Finelec). On the Societe Generale d™Entreprises (SGE) and Loucher
l™E ´ ´´ ´ ´
Notes to Chapter 4, Pages 153“153 387

and Giros, see Chapter 3, herein. See also Davenport-Hines, Dudley Docker,
204, and Segreto, ˜˜Le Role du Capital Etranger,™™ 1002“6. The So¬na Annual
Report 1929 listed the following major participations in France: Societe ´´
´ lectrique, Paris (SCIE), with its key af¬liates; Societe
Centrale pour l™Industrie E ´´
´ lectrique, Paris (Finelec), with its broad activities, including those in
Financiere E
French colonies; and the ˜˜electrical enterprises™™: Compagnie Centrale d™Energie
´ ´ ´
Electrique, Paris; Union d™Electricite, Paris; Compagnie Electrique de la Loire et
du Centre, Paris; Societe des Forces Motrices de La Truyere, Paris. On these last
´´ `
four companies, see Brion, ˜˜Le Role de la So¬na,™™ 221“23.
124. On the ˜˜new™™ So¬na, see its ¬rst Annual Report 1929. See also Ranieri,
Dannie Heineman, 162; Moody™s Manual (Utilities) 1930, 2317; Brion, ˜˜Le
Role de la So¬na,™™ 227; New York Times, Oct. 22, 1928; and Dominque
Barjot, Henri Morsel, and Sophie Coeure, eds., Strategies, Gestion, Manage-
´ ´
´ lectriques et Leurs Patrons, 1895“1945 (Paris: EDF,
ment: Les Compagnies E
2001), 42, 47. In the reorganization, the New York Times, Oct. 22, 1928,
listed the huge number of subscribers to the equity: American ¬rms included
Electric Bond and Share, International GE, Dillon Read, Bankers Trust,
Guaranty Co., Kuhn Loeb, Lee Higginson, International Acceptance Bank,
and International Acceptance Trust. The broad international involvements
were amazing. Participants included Banque de Bruxelles, Brussels, and other
Belgian groups. Swiss representation comprised Banque pour Entreprises
Electriques (Elektrobank), Zurich, and Credit Suisse, Zurich. From Spain were
Compan±a Hispano-Americana de Electricidad (CHADE), Madrid, along with
several Spanish banks involved in the latter. Gesellschaft fur Elektrische ¨
Unternehmungen (Gesfurel), Berlin, and a collection of German banks “ for
example, the large Berlin banks: Deutsche Bank, Dresdner Bank, and others “
took part, as did M. M. Warburg & Co., Hamburg. Societe Generale ´´ ´´
d™Entreprises, Paris, Comptoir National d™Escompte de Paris, along with
other French ¬rms, had a presence. British participants included Electric
and Railway Finance Corporation (Elra¬n, an investment trust identi¬ed
with Dudley Docker), Baring Brothers, Lazard Brothers Ltd., Midland Bank,
N. M. Rothschild & Sons, Vickers Ltd., and Edward Peacock. Then there were
the Italian Banca Commerciale Italiana (BCI), Milan, and the Dutch
Amsterdamsche Bank, Hope & Co., Mendelssohn & Co., and Nederlandsche
Handel Maatschappij. A Hungarian bank was involved, as was Petschek &
Cie., Prague. There were many others that we have not listed, but as a group
they represented a portrait of the ¬nancial world involved in electri¬cation in
the late 1920s. Vickers Ltd. and International GE were exceptional
manufacturers listed among those involved. See Ranieri, Dannie Heineman,
35“36, and passim for the close, long-standing relationship between Heineman
and Oliven. Oliven (1870“1939) was two years older than Heineman. See also
ibid., 162“63, for the greatly expanded group of administrators of the new
So¬na. The best description of the broad interests of So¬na is in its ¬fty-one-
page Annual Report 1929. The involvements listed in the Moody™s Manual
(Utilities) 1930 do not capture, for example, So¬na™s participations in Eastern
Europe, where through Societe Anonyme pour Entreprises d™Electricite et de
´´ ´
Communication, Budapest, So¬na had interests in Czechoslovakia, Hungary,
Notes to Chapter 4, Pages 153“155

Romania, and Yugoslavia “ in electricity, tramways, and local railroads.
Annual Report 1929, 22.
Sayers, Bank of England, I, 88n; Steven Tolliday, Business, Banking, and
Politics: The Case of British Steel, 1918“1939 (Cambridge, MA: Harvard
University Press, 1987), 199, and Davenport-Hines, Dudley Docker, passim
(on Reginald McKenna, Midland, Docker, and So¬na). Southard, American
Industry in Europe, 211 (U.S. interests). Moody™s Manual (Utilities) 1930,
2137, gives the 1929“1930 So¬na board. The only American listed on the
So¬na board was the lawyer Gordon Auchincloss, son-in-law of Col. Edward
House. On Heineman™s friendship with House, see Ranieri, Dannie Heineman,
113, 299“322, 421“25. Auchincloss was at the 1919 Peace Conference in Paris
as House™s secretary; he had undoubtedly ¬rst met Heineman there. On
Auchincloss, see Who™s Who in America 1924“1925, 259, and miscellaneous
references in Ranieri, Dannie Heineman.
Moody™s Manual (Utilities) 1930, 2316. Mexico was not on the list in
Moody™s, probably because So¬na™s control was exercised through Sidro (see
Information from Luciano Segreto and data in Davenport-Hines, Dudley
He was, for example, a long-time friend (from 1907 onward) of Konrad
Adenauer. Adenauer was mayor of Cologne, 1917“1933. See Schwarz, Konrad
Adenauer, I, 119, and passim.
BEAM, Combines, 61, and ˜˜Consejo de Administracion de la CHADE,
1926“1930,™™ given in Gabriela Dalla Corte, ˜˜Associaciones y Negocias: Las
Redes Sociales Vasco-Catalanas en el Cono Sur Latinoamericano (1911“
1936),™™ July 14, 2005, 5 (http://www.euskosare.org/, accessed Sept. 26, 2007).
For Oliven on the So¬na board, see So¬na, Annual Report 1929, 2, and
Moody™s Manual (Utilities) 1930, 2316.
Moody™s Manual (Utilities) 1930, 2316“17; Brion, ˜˜Le Role de la So¬na,™™
230“31, and ibid. 230“231n36, for the various interests involved in Caninlipo.
Ranieri, Dannie Heineman, 163, notes that the key French holdings were those
of the Giros group. (Caninlipo had a short life; it was liquidated in 1935. Ibid.,
BEAM, Combines, 61, 155, and Brion, ˜˜Le Role de la So¬na,™™ passim. In
1928, Gesfurel was raising money in New York. It had a $5 million dollar
twenty-¬ve-year 6 percent debenture isssue (due 1953). The price was not
discounted. It sold at 100. See Electrical World, 92 (Sept. 29, 1928), 662.
Heineman, while American-born and retaining his American citizenship and
while German-educated, had resided in Brussels since 1905 and by the 1920s
had fully identi¬ed himself with So¬na and ˜˜Belgian™™ interests.
Once more, the reader is warned that F. S. Pearson, who died in the sinking of
the Lusitania in 1915, was unrelated to the British Pearsons: S. Pearson and
Son, Weetman Pearson (Lord Cowdray), and the latter™s second son, Clive
Pearson, who came to run Whitehall Electric Investments Ltd. Sir Edward
Pearson who died in 1925 was Weetman Pearson™s brother.
Moody™s Manual (Utilities) 1930, 2204 (date of registration). Armstrong and
Nelles, Southern Exposure, 258“71, and Ranieri, Dannie Heineman, 146“59
Notes to Chapter 4, Pages 155“155 389

(on Sidro), esp. 150“151 (on the leadership at origin). On Maurice Despret
(1861“1933), see Herman Van der Wee and Monique Verbreyt, The Generale
Bank 1822“1997 (Tielt, Belgium: Lannoo, 1997), 121“22, and Ginette Kurgan-
Van Hentenryk, ˜˜Le Patronat de l™Electricite en Belgique, 1895“1945,™™ in
Dominque Barjot, Henri Morsel, and Sophie Coeure, eds., Strategies, Gestion,
´ ´
´ lectriques et Leurs Patrons, 1895“1945 (Paris:
Management: Les Compagnies E
EDF, 2001), 64.
Charles F. Mallory, ˜˜Financial Problems of the North American Electrical
Utilities in Latin America,™™ M.S. thesis, MIT, 1956, 34.
Armstrong and Nelles, Southern Exposure, 259. For So¬na/Sidro, Mexlight,
and the Canadians, 1924“1929, see Reinhard Liehr and Georg Leidenberger,
˜˜El Paso de una Free-Standing Company a una Empresa Publica: Mexican
Light and Power y Mexico Tramways, 1902“1960,™™ in Sandra Kuntz Ficker
and Horst Pietschmann, eds., Mexico y La Econom±a Atlantica (Siglos XVIII“
´ ´
XX) (Mexico City: El Colegio de Mexico, Centro de Estudios Historicos,
´ ´
2006), 289, 297“98.
Sources agree that in 1924 Loewenstein had sold to So¬na a suf¬ciently large
block of Sidro shares so as to put So¬na in control; indeed, looking at the 1923
management, one would believe that So¬na was already the key in¬‚uence. On
the other hand, as Armstrong and Nelles, Southern Exposure, 259, and
Ranieri, Dannie Heineman, 151“52, point out, Loewenstein behaved as
though he remained the dominant ¬gure.
For the very complicated con¬‚icts between Heineman of So¬na and Loewenstein
over Brazilian Traction and Mexlight control, and where the Canadians ¬t into
the disputes, see Ranieri, Dannie Heineman, 146“59; Armstrong and Nelles,
Southern Exposure, 263“71; and McDowall, Light, 289“95. McDowall writes
that in October 1926 Heineman, ˜˜who had no interest in seeing SIDRO become
a full-¬‚edged rival of SOFINA, began to voice opposition to any scheme that
would affect the in¬‚uence of SOFINA™™ on Brazilian Traction. Ibid., 293“94.
Loewenstein was furious; the quarrel was prolonged; at a Toronto meeting of
Brazilian Traction in May 1928, he denounced Heineman, ˜˜using names that
were absolutely inexcusable.™™ Ibid., 296. Later in May, Loewenstein attended a
board meeting of Mexican Light and Power Co. in Toronto and once more
verbally clashed with Heineman. Ibid. On the letter from Heineman to Peacock
(Dec. 17, 1926), see Ranieri, Dannie Heineman, 153. Ibid., 155, dates the
takeover of control by Heineman and his group of Sidro and Brazilian Traction
to January 1927. Liehr and Leidenberger, ˜˜El Paso de Una Free-Standing
Company,™™ 297“98, write that in January 1929 (after Loewenstein was out of
the picture) So¬na, through Sidro, consolidated its capacity to control Mexlight,
albeit the So¬na/Sidro presence was evident from 1924 onward, and Liehr and
Leidenberger suggest that So¬na/Sidro had effective control much earlier than
January 1929 (they do not deal with the clash between Loewenstein and
Heineman). It does seem, however, that in 1928“1929 So¬na/Sidro increased its


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