Silesian-American Corporation
Encyclopedia
Silesian-American Corporation, SACO – was a holding company for Giesche
Spolka Akcyjna (Giesche Corporation), operating in Upper Silesia
, Poland
during interwar times.
Silesian-American held 100% of Giesche Spolka Akcyjna stock.
SACO was established in Delaware
in 1926 and was owned by Silesian Holding Company: 51% of common stock and 58,33% of preferred stock
. The remaining 49% of common and 41,67% of preferred stock went to Giesche’s Erben, a German
corporation (full name: Bergwerksgesellschaft Georg von Giesche's Erben) – in return for the entire capital stock of Giesche Spolka Akcyjna.
Previously Giesche’s Erben was a sole owner of Giesche Spolka Akcyjna.
Silesian Holding Company was owned by Anaconda Copper
Mining (65%) and the remainder originally by W. Averell Harriman
, and then by Harriman or close affiliates and associates. SACO gave substantial loans to Giesche’s Erben, too. The funds for take-over and loan purposes were obtained by selling $15,000,000 collateral trust sinking fund bonds maturing August 1, 1941.
, German military commissar took the control of Giesche Spolka Akcyjna. SACO was thus deprived of all income from the Spolka properties and was unable to pay dividends on its outstanding bonds. With the approach of August 1, 1941, the maturity date of the bonds, the company had only about half a million dollars in cash. Accordingly it filed a petition for reorganization under Chapter X of the Bankruptcy Act
.
, Giesche’s Erben General Manager, set up a plan of regaining control on Polish corporation, which was called repatriation scheme.
Schulte had close relations with a group of Swiss bankers. Just before war he established a subsidiary of Giesche’s Erben in Switzerland
, called Non Ferrum (full name Non Ferrum Gesellschaft zur Finanzierung von Unternehmungen des Bergbaus und der Industrie der Nichteisenmetalle) and transferred Erben’s stock of SACO to that new company.
In 1941 the Swiss bank LaRoche, acting jointly with Schulte, established another company in Switzerland, Ikap (Internationale Kapitalanlegen Gesellschaft). Schulte convinced Harriman and Cornelius Kelley (president of Anaconda Copper) to sell their shares in Silesian Holding Company to Ikap. Unfortunately Swiss paper work held matters up beyond June 14, 1941, when the US Presidential freezing order was extended to Switzerland. This subjected the transactions to United States Treasury Department scrutiny and approval. As it was obvious that the stock was to be held for the benefit of enemy (a German corporation Bergwerksgesellschaft Georg von Giesche's Erben), the application to the Treasury Department for permission to make the necessary transfers was refused on July 26, 1941. Two later applications (of August and December) were also refused. Moreover, in November 1942, Alien Property Custodian, acting under Trading with the Enemy Act
, vested German owned shares in Silesian-American Corporation.
Order No. 370: Silesian-American Corp. Executed November 17, 1942, signed by Leo Crowley
, Alien Property Custodian
: “Two blocks of stock - 98,000 shares of common and 50,000 shares of preferred stock in the Silesian-American, a Delaware corporation [are being confiscated]. The stock, prior to August 31, 1939, stood in the stock book of Silesian in the name of Non Ferrum, Zurich, Switzerland, a Swiss corporation, which held the stock for the benefit of Bergwerksgesellschaft Georg von Giesche's Erben, a German corporation”.
This was the final nail in the “coffin” of great Eduard Schulte’s repatriation scheme.
Sixteenth Annual Report of the Securities and Exchange Commission, Fiscal Year Ended June 30, 1950, United States Government Printing Office, Washington: 1950 (which may be found at http://www.sechistorical.org )
U.S. Supreme Court Dec. 8, 1947 SILESIAN AMERICAN CORPORATION V. CLARK (which may be found at http://supreme.justia.com/us/332/469/ )
United States Court of Appeals Second Circuit April 13, 1953 CONWAY v. UNION BANK OF SWITZERLAND (which may be found at http://www.jurisearch.com/default.asp )
United States Court of Appeals Second Circuit, Second Circuit. July 3, 1946 SILESIAN-AMERICAN CORPORATION et al. v. MARKHAM, Alien Property Custodian (which may be found at http://www.jurisearch.com/default.asp )
United States Court of Appeals Second Circuit Dec. 6, 1956 SCRIBNER & Miller v. Francis CONWAY, Trustee of Silesian-American Corporation (which may be found at http://www.jurisearch.com/default.asp )
Time Magazine Jun. 14, 1926 (http://www.time.com/time/archive/preview/0,10987,751560,00.html )
Also a lot of Polish language sources, concerning mainly the history of Silesian industry, the history of Katowice
and its districts, web pages of particular Polish coal mines. For example:
http://www.giszowiec.sewera.pl/
http://www.kopalnia.com.pl/
The book “Secrets of Upper Silesian Corporations” by Jerzy Jaros – in Polish („Tajemnice górnośląskich koncernów” Śląski Instytut Naukowy, Katowice
1983)
Giesche
Giesche Corp. – one of the biggest and most respectable companies operating in Upper Silesia, in Poland, during interwar times...
Spolka Akcyjna (Giesche Corporation), operating in Upper Silesia
Silesia
Silesia is a historical region of Central Europe located mostly in Poland, with smaller parts also in the Czech Republic, and Germany.Silesia is rich in mineral and natural resources, and includes several important industrial areas. Silesia's largest city and historical capital is Wrocław...
, Poland
Poland
Poland , officially the Republic of Poland , is a country in Central Europe bordered by Germany to the west; the Czech Republic and Slovakia to the south; Ukraine, Belarus and Lithuania to the east; and the Baltic Sea and Kaliningrad Oblast, a Russian exclave, to the north...
during interwar times.
Silesian-American held 100% of Giesche Spolka Akcyjna stock.
SACO was established in Delaware
Delaware
Delaware is a U.S. state located on the Atlantic Coast in the Mid-Atlantic region of the United States. It is bordered to the south and west by Maryland, and to the north by Pennsylvania...
in 1926 and was owned by Silesian Holding Company: 51% of common stock and 58,33% of preferred stock
Preferred stock
Preferred stock, also called preferred shares, preference shares, or simply preferreds, is a special equity security that has properties of both an equity and a debt instrument and is generally considered a hybrid instrument...
. The remaining 49% of common and 41,67% of preferred stock went to Giesche’s Erben, a German
Germany
Germany , officially the Federal Republic of Germany , is a federal parliamentary republic in Europe. The country consists of 16 states while the capital and largest city is Berlin. Germany covers an area of 357,021 km2 and has a largely temperate seasonal climate...
corporation (full name: Bergwerksgesellschaft Georg von Giesche's Erben) – in return for the entire capital stock of Giesche Spolka Akcyjna.
Previously Giesche’s Erben was a sole owner of Giesche Spolka Akcyjna.
Silesian Holding Company was owned by Anaconda Copper
Anaconda Copper
Anaconda Copper Mining Company was one of the largest trusts of the early 20th century. The Anaconda was purchased by Atlantic Richfield Company on January 12, 1977...
Mining (65%) and the remainder originally by W. Averell Harriman
W. Averell Harriman
William Averell Harriman was an American Democratic Party politician, businessman, and diplomat. He was the son of railroad baron E. H. Harriman. He served as Secretary of Commerce under President Harry S. Truman and later as the 48th Governor of New York...
, and then by Harriman or close affiliates and associates. SACO gave substantial loans to Giesche’s Erben, too. The funds for take-over and loan purposes were obtained by selling $15,000,000 collateral trust sinking fund bonds maturing August 1, 1941.
WWII
During WWII, when Nazi army invaded PolandPoland
Poland , officially the Republic of Poland , is a country in Central Europe bordered by Germany to the west; the Czech Republic and Slovakia to the south; Ukraine, Belarus and Lithuania to the east; and the Baltic Sea and Kaliningrad Oblast, a Russian exclave, to the north...
, German military commissar took the control of Giesche Spolka Akcyjna. SACO was thus deprived of all income from the Spolka properties and was unable to pay dividends on its outstanding bonds. With the approach of August 1, 1941, the maturity date of the bonds, the company had only about half a million dollars in cash. Accordingly it filed a petition for reorganization under Chapter X of the Bankruptcy Act
Bankruptcy Act of 1898
The Bankruptcy Act of 1898 was the first United States Act of Congress involving Bankruptcy that gave companies an option of being protected from creditors...
.
Repatriation scheme
Owners and leading managers of Bergwerksgesellschaft Georg von Giesche's Erben could not reconcile themselves to the deprivation of Giesche Spolka Akcyjna, which was bought by Americans in 1926. Eduard SchulteEduard Schulte
Eduard Schulte was a prominent German industrialist. He was one of the first to warn the Allies and tell the world of the Holocaust and systematic exterminations of Jews in Nazi Germany occupied Europe....
, Giesche’s Erben General Manager, set up a plan of regaining control on Polish corporation, which was called repatriation scheme.
Schulte had close relations with a group of Swiss bankers. Just before war he established a subsidiary of Giesche’s Erben in Switzerland
Switzerland
Switzerland name of one of the Swiss cantons. ; ; ; or ), in its full name the Swiss Confederation , is a federal republic consisting of 26 cantons, with Bern as the seat of the federal authorities. The country is situated in Western Europe,Or Central Europe depending on the definition....
, called Non Ferrum (full name Non Ferrum Gesellschaft zur Finanzierung von Unternehmungen des Bergbaus und der Industrie der Nichteisenmetalle) and transferred Erben’s stock of SACO to that new company.
In 1941 the Swiss bank LaRoche, acting jointly with Schulte, established another company in Switzerland, Ikap (Internationale Kapitalanlegen Gesellschaft). Schulte convinced Harriman and Cornelius Kelley (president of Anaconda Copper) to sell their shares in Silesian Holding Company to Ikap. Unfortunately Swiss paper work held matters up beyond June 14, 1941, when the US Presidential freezing order was extended to Switzerland. This subjected the transactions to United States Treasury Department scrutiny and approval. As it was obvious that the stock was to be held for the benefit of enemy (a German corporation Bergwerksgesellschaft Georg von Giesche's Erben), the application to the Treasury Department for permission to make the necessary transfers was refused on July 26, 1941. Two later applications (of August and December) were also refused. Moreover, in November 1942, Alien Property Custodian, acting under Trading with the Enemy Act
Trading with the Enemy Act
The Trading with the Enemy Act, sometimes abbreviated as TWEA, is a United States federal law, , enacted in 1917 to restrict trade with countries hostile to the United States. The law gives the President the power to oversee or restrict any and all trade between the U.S. and its enemies in times of...
, vested German owned shares in Silesian-American Corporation.
Order No. 370: Silesian-American Corp. Executed November 17, 1942, signed by Leo Crowley
Leo Crowley
Leo Thomas Crowley was a member of the cabinet of President Franklin D. Roosevelt as the head of the Foreign Economic Administration. Previously he had served as Alien Property Custodian and as chief of the Federal Deposit Insurance Corporation...
, Alien Property Custodian
Alien Property Custodian
An Alien Property Custodian was an office within the Government of the United States during World War I and again during World War II, serving as a Custodian of Enemy Property to property that belonged to US enemies.-World War I:...
: “Two blocks of stock - 98,000 shares of common and 50,000 shares of preferred stock in the Silesian-American, a Delaware corporation [are being confiscated]. The stock, prior to August 31, 1939, stood in the stock book of Silesian in the name of Non Ferrum, Zurich, Switzerland, a Swiss corporation, which held the stock for the benefit of Bergwerksgesellschaft Georg von Giesche's Erben, a German corporation”.
This was the final nail in the “coffin” of great Eduard Schulte’s repatriation scheme.
The post-war times
Before Silesian-American was finally dissolved, it took part in several legal proceedings in the 50’s, mainly raised by its bondholders.Sources
United States Court of Appeals Second Circuit, Dec. 26, 1950. CONWAY v. SILESIAN-AMERICAN CORP. (which may be found at http://www.jurisearch.com/default.asp )Sixteenth Annual Report of the Securities and Exchange Commission, Fiscal Year Ended June 30, 1950, United States Government Printing Office, Washington: 1950 (which may be found at http://www.sechistorical.org )
U.S. Supreme Court Dec. 8, 1947 SILESIAN AMERICAN CORPORATION V. CLARK (which may be found at http://supreme.justia.com/us/332/469/ )
United States Court of Appeals Second Circuit April 13, 1953 CONWAY v. UNION BANK OF SWITZERLAND (which may be found at http://www.jurisearch.com/default.asp )
United States Court of Appeals Second Circuit, Second Circuit. July 3, 1946 SILESIAN-AMERICAN CORPORATION et al. v. MARKHAM, Alien Property Custodian (which may be found at http://www.jurisearch.com/default.asp )
United States Court of Appeals Second Circuit Dec. 6, 1956 SCRIBNER & Miller v. Francis CONWAY, Trustee of Silesian-American Corporation (which may be found at http://www.jurisearch.com/default.asp )
Time Magazine Jun. 14, 1926 (http://www.time.com/time/archive/preview/0,10987,751560,00.html )
Also a lot of Polish language sources, concerning mainly the history of Silesian industry, the history of Katowice
Katowice
Katowice is a city in Silesia in southern Poland, on the Kłodnica and Rawa rivers . Katowice is located in the Silesian Highlands, about north of the Silesian Beskids and about southeast of the Sudetes Mountains.It is the central district of the Upper Silesian Metropolis, with a population of 2...
and its districts, web pages of particular Polish coal mines. For example:
http://www.giszowiec.sewera.pl/
http://www.kopalnia.com.pl/
The book “Secrets of Upper Silesian Corporations” by Jerzy Jaros – in Polish („Tajemnice górnośląskich koncernów” Śląski Instytut Naukowy, Katowice
Katowice
Katowice is a city in Silesia in southern Poland, on the Kłodnica and Rawa rivers . Katowice is located in the Silesian Highlands, about north of the Silesian Beskids and about southeast of the Sudetes Mountains.It is the central district of the Upper Silesian Metropolis, with a population of 2...
1983)