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It is difficult to overstate just how large US Steel was when it was formed as an agglomeration of industrial companies founded by moguls like Andrew Carnegie 116 years ago. But the Financial Times took a pretty good shot, calling the merger “the biggest industrial combination ever formed probably in the history of the world”.

As the company’s stock sheds a quarter of its value on Wednesday, fastFT has clipped some of the paper’s earliest coverage of US Steel, which controlled some 60 per cent of the American steel market and whose tentacles stretched into railroads and mining.

February 26, 1901

The first reference in the Financial Times to the “United States Steel Corporation” was in February 1901, with a story that announces the group’s incorporation.

US Steel, the story explains, combined the Carnegie Company, the Federal Steel Company, the National Tube Company, the American Steel and Wire Company, the American Tin Plate Company, the National Steel Company, the American Steel Hoop Company and the American Sheet Steel Company. Broadly, the group actually controlled a dozen subsidiaries in the “iron, coal, railroad, steel, wire and mining industries,” according to Carnegie Mellon research citing US congressional records.

These groups were titans of industry, brought together by figures like Carnegie, John Pierpont (JP) Morgan and Charles Schwab.

The combined entity generated annual earnings of more than $100m, with total capitalisation of $1.1bn — staggering sums at a time when a dozen eggs cost around 22 cents.

February 27, 1901

A day later, the FT provided further details of what it called the “Morgan-Carnegie Combine” on the front page, disclosing more information about the group’s valuation:

  • Common stock: $400m
  • Preferred stock: $400m
  • Bonds: $300m
More colour, however, came on page 4, in a piece entitled “A Morganatic Marriage”. (An excerpt is included below, but the full story can be read here).

Among the choicest bits:

  • The FT called the deal “the biggest industrial combination ever formed probably in the history of the world”, adding that “the magnitude of the figures [are] … so great that the ordinary man finds it difficult to grasp their full significance”.
  • The paper warns that the sheer size of the company “may easily give rise to trust legislation of a drastic character”. This ultimately came true.

March 2, 1901

“Mr Pierpont Morgan is certainly profiting from the trust mania which prevails in the States”. Indeed. His commissions on the US Steel deal alone amounted to $7.52m.

April 26, 2017

Flash-forward more than a century, and US Steel is now the third-biggest US steel producer, according to its 2016 annual report. Its shares tumbled 25 per cent on Wednesday, sparked by a cut to its full-year outlook.

The group has gone through numerous iterations since its formation, but even now, it remembers its turn-of-the-20th-Century origins, calling its transformation plan the “Carnegie Way”.

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