Editing Andrew Carnegie (section)

====1901: U.S. Steel====
In 1901, Carnegie was 65 years of age and considering retirement. He reformed his enterprises into conventional [[Joint-stock company|joint stock corporation]]s as preparation for this. [[J. P. Morgan|John Pierpont Morgan]] was a banker and America's most important financial deal maker. He had observed how efficiently Carnegie produced profits. He envisioned an integrated steel industry that would cut costs, lower prices to consumers, produce in greater quantities and raise wages to workers. To this end, he needed to buy out Carnegie and several other major producers and integrate them into one company, thereby eliminating duplication and waste. He concluded negotiations on March 2, 1901, and formed the [[U.S. Steel|United States Steel Corporation]]. It was the first corporation in the world with a market capitalization of over $1 billion.

The buyout, secretly negotiated by [[Charles M. Schwab]] (no relation to [[Charles R. Schwab]]), was the largest such industrial takeover in United States history to date. The holdings were incorporated in the United States Steel Corporation, a trust organized by Morgan, and Carnegie retired from business.<ref name="EB1911"/> His steel enterprises were bought out for $303,450,000.<ref name="Hawke 1980"/>

Carnegie's share of this amounted to $225.64 million (in {{Inflation-year|US}}, ${{Formatprice|{{Inflation|US|225639000|1901}}}}), which was paid to him in the form of 5%, 50-year gold bonds. The letter agreeing to sell his share was signed on February 26, 1901. On March 2, the circular formally filed the organization and capitalization (at $1.4 billion—4% of the U.S. gross domestic product at the time) of the United States Steel Corporation actually completed the contract. The bonds were to be delivered within two weeks to the Hudson Trust Company of [[Hoboken, New Jersey]], in trust to Robert A. Franks, Carnegie's business secretary. There, a special vault was built to house the physical bulk of nearly $230 million worth of bonds.<ref>{{cite book |last1=Krass |first1=Peter |url=https://books.google.com/books?id=nwJ-UFP20mMC&q=carnegie+vault+for+us+steel+bonds&pg=PT416 |title=Carnegie |date=2002 |publisher=John Wiley & Sons |isbn=0471386308 |location=New York |at=Chapter 29 |language=en-us |access-date=December 3, 2019}}</ref>