(Extract from Spain of Today by W. R. Lawson 1889)
To-day we bring to your attention the account of The Rio Tinto taken from William R. Lawson’s Spain of To-day which was published earlier this year.
– If Rio Tinto shares were suddenly to disappear from the official list, there would be lamentation in the foreign market. Nevertheless, only twenty years ago the name would have had no meaning whatever to the most intelligent and wide-awake of foreign jobbers. It would have awakened no pleasant associations, or indeed associations of any kind, in Throgmorton Street. As the name of a small river in the south of Spain, it was quite outside the limits of financial geography. To-day it represents one of the greatest mineral properties ever known in history, and has been the subject of the wildest gamble in modern speculation. How in the course of half a generation it reached that proud eminence is a fine example of the uncertainties of the mining lottery. The whole group of mines now known as Spanish copper mines—though one of them is, in fact, situated in Portugal—has had a romantic history, and most romantic of all is the Rio Tinto’s.
Napoleon III’s coup d’état, it will be remembered, set free many Frenchmen of anti-Bonapartist views to explore other countries. While many of them honoured us with their society in Leicester Square and were content to earn a moderate, if precarious, livelihood as teachers of their own language, others of a more adventurous turn directed their attention to the South. Spain commended itself to them as an unexploited country, where finance and republicanism might be combined. They had heard of its mineral wealth, and though their knowledge of mining was shadowy, they had, like true Frenchmen, faith in themselves. They clubbed together a few thousand francs and sent on a deputation in advance to survey the land.
The deputies found their way to the province of Huelva, the most southern province of Spain, and then possessing but two claims to distinction: one, that it had fitted out the first expedition of Columbus to America; and the other, that it was rich in old Roman mines, including, according to tradition, the Tharsis of Scripture.
So the French pioneers came down to Huelva, where lay the potentialities of growing rich beyond the dreams of avarice, as Dr Johnson used to say. They came to the Rio Tinto mine, which was then in charge of two Spanish engineers on behalf of the Government. The Spaniards were hospitable, showing them over all the property as it then was, and initiating them into the secrets of prospecting.
Armed with the knowledge they had thus picked up, the Frenchmen explored the surrounding hills, and examined carefully all the old workings of which local tradition had preserved any account. They stumbled on the Tharsis, in an adjoining valley to the Tinto; and away to the west, beyond the Portuguese frontier, they found the once famous San Domingo mine, which became afterwards the Mason and Barry. Of those they preferred the middle deposit—a very great mistake for themselves, as it turned out. A lease of it was obtained with little difficulty from the Spanish Government, and a French society was formed to work it. Hence the Tharsis Company, the oldest of the so-called Spanish copper mines.
The actual working of the property fell, however, into the hands of Scotsmen, who formed a company of their own in Glasgow, and crowded out the Parisians. Since then the Tharsis has been a Glasgow institution, as absolutely parochial and strictly private as St Rollox itself. It has no history beyond what Sir Charles Tennant and his cronies consider to be good for it and themselves.
The Frenchmen having thus narrowly missed Rio Tinto, the Germans had a shot at it next, and it did not slip through their fingers. Spain was then, as it is still, the happy hunting-ground of exploiters of all nations. When the great German exodus began during the American Civil War, thousands of young Teutons came over to London to learn the English art of money-making, in which so many of them have since beaten their masters.
Goschens, Huths, Murrietas, and all the principal foreign houses were inundated with recruits ready to go anywhere and do anything in the way of honest business. Most of them had several languages at their finger-ends, and when an opening occurred at the River Plate or in the Philippine Islands, they were equally fit for it. One of these irrepressible young Germans, Wilhelm Sundheim, had come from Hesse-Darmstadt with an introduction to Frederick Huth & Company—then, as now, the heads of a world-wide business.
At their recommendation he went to the south of Spain, and broke ground in Seville, where he met with several compatriots, among others Mr Doetsch, now the managing director of Rio Tinto. Through an engineer who used to come up to Seville from Huelva, then a small fishing village, where there is now a population of over 20,000 souls, he heard that a good business was to be done in buying manganese ore from the small mines in the neighbourhood and shipping it to England.
Mr Sundheim promptly migrated to Huelva, and became a manganese merchant and shipper, first in partnership with a friend who went from London to join him, and afterwards with Mr Doetsch, who has been his associate in a great variety of undertakings, radiating from their original manganese agency. They have built railways, opened up mines, laid out vineyards, developed marble quarries, and turned their busy hands to everything they found an opening for.
The Huelva of to-day is their creation, and that of the Rio Tinto Company. To them it owes its hotel—the largest and finest south of Madrid—its harbour improvements, its railway communication with the North, but, above all, its pre-eminence as the greatest mineral shipping port in Europe.
It was through another German that they came to know about the Rio Tinto. Mr Blum, a trained mining-engineer and mineralogist, had been for several years prospecting all over Spain when Mr Sundheim came to Huelva. He had, at last, settled down near the Tharsis mine, watching with great interest the progress of the new French company. From time to time he visited the Rio Tinto, which was being spasmodically and, as a rule, unprofitably worked by the Spanish Government. He saw that, though it did not pay, it was opening out a splendid mine, and that valuable information he communicated to his friends Sundheim and Doetsch.
They, on their side, kept a sharp look-out for financial opportunities, which were not long in coming. The Spanish Government was carrying on a desperate struggle for life amid the bankruptcy and anarchy into which it had been plunged by the recent Carlist war. It could only pay its way by realising all the loose property of the State convertible into coin. When a hint was given it that a purchaser might be found for the Rio Tinto copper mines, it rose to the bait eagerly. A bill, virtually drafted by Messrs Sundheim and Doetsch, and piloted through the Cortes by a provincial deputy of Huelva, empowered it to have the mines valued and put up for sale by public auction. This was done, and they were knocked down for nearly four million sterling to a syndicate of London and Bremen capitalists, with Messrs Matheson & Co. at its head.
