Source: courtesy Wikimedia Commons
MATTHEWS, WILMOT DELOUI, businessman; b. 22 June 1850 in Burford Township, Upper Canada, son of Wheeler Douglas Matthews and Maria Susanna Colton; m. 29 Aug. 1872 Annie Jane Love in Toronto, and they had two sons and two daughters; d. there 24 May 1919.
Wilmot D. Matthews’s paternal grandfather, Abner Matthews, a native of New Hampshire, settled in Burford before 1801 and was ordained as a Methodist Episcopal minister in 1820. Wheeler Matthews built up a business there as a miller and grain and produce dealer. In 1856 he and his family moved to Toronto, where he specialized, under the name W. D. Matthews and Company, in supplying the malting industry. Eventually known as the “barley king” of southwestern Ontario, he recognized the preference of American breweries for Canadian barley and engaged in cross-border trade, setting up regional bases in Le Roy and Attica, N.Y.
Educated at the Normal School in Toronto, Wilmot entered his father’s business as a clerk about 1867. In 1873, a year after marrying the daughter of a prominent Toronto druggist, he became a partner. In the early 1880s his reputation in the grain trade was substantial enough that he was made president of the Toronto Corn Exchange Association, which he represented in 1883 before a parliamentary standing committee on the bill to form a court of railway commissioners in Canada. By 1886 W. D. Matthews and Company was one of the more prosperous flour, grain, and malt businesses in the country, with two malt-houses in Ontario and four in the United States. The deaths of Wilmot’s father in 1888 and his mother two years later left him wealthy and firmly in control of the company. In 1895 he formed a malt dealership with Lionel Herbert Clarke* (L. H. Clarke and Company); five years later the two would also set up the Canada Malting Company Limited. In addition, by 1898 Matthews was a director of the Empire Produce Company and chairman of the government’s eastern board for grain standards.
The grain trade in Ontario, however, was in decline, largely because of the shift to the western prairies. Matthews recognized that Toronto would be marginalized in the trade, and he diversified by carefully reinvesting in sectors of the Ontario economy with brighter futures. His earliest interest was the Dominion Bank, of which he had become a director on 27 Sept. 1882. He also became a director of Canadian Lloyds (a cargo company) and, in 1888, of the Canadian Pacific Railway, the most prestigious enterprise in the country. His business stature grew rapidly. In 1888–89 he served as president of the Toronto Board of Trade, in which office he presided over the erection of the board’s new building at Yonge and Front. By 1891 he had built an elegant stone house at Hoskin Avenue and St George Street, a permanent monument to his success.
As a result of his diversification, Matthews, over the next two decades, would be identified far more with finance and big business than with the grain trade. During the era of prosperity that coincidentally began with Wilfrid Laurier’s election as prime minister in 1896 and ended with the merger boom of 1909–13, new industrial and financial enterprises with a pan-Canadian reach would absorb or marginalize many of the regional enterprises that had once dominated the economic landscape. The main poles of this change were Montreal and Toronto. Matthews’s membership in the business élite of Toronto meant that he could pick and choose his associates and investments. As founding president of the Toronto Incandescent Electric Light Company Limited in 1889, for example, he became aligned with utilities syndicator Frederic Nicholls*. By 1902 Matthews’s capitalistic involvement was exceptionally broad-based: a promoter of navigation, mining trust, coal, and cement companies in Canada and of street-railways in Cuba, he was a director of the Canadian General Electric Company Limited (with Nicholls, George Albertus Cox, Robert Jaffray, Edmund Boyd Osler*, and others) and of the Trusts Corporation of Ontario.
Cox was possibly the richest and best-connected Toronto businessman of the era, but Matthews’s most important associate was undoubtedly Osler. After forming the Toronto brokerage firm of Osler and Hammond in 1882, he had flourished, part of a new generation of stockbrokers. Accepting shares in payment for his services, he became a director, among other concerns, of the CPR and the Dominion Bank. In 1901, at the same time that he was chosen the bank’s president, Matthews joined him as vice-president. To their frequent business association was added a family connection when Matthews’s son Wilmot Love, who had entered his grain business about 1899, married Osler’s daughter Annabel Margaret in 1903.
A contemporary assessment that Matthews was “one of the shrewdest business men in Canada” merely hints at the skills and connections that had taken him to the inner circles of capitalism in Toronto. In particular, he showed sound vision in investing in the new manufacturing and financial operations at the core of Canada’s growth. Many were CPR initiatives. In 1902 Matthews and Osler accompanied the railway’s president, Sir Thomas George Shaughnessy*, on his annual inspection tour of western Canada. That same year, during the CPR’s reorganization of the Canada North-West Land Company (an Osler creation), Matthews and miller Robert Meighen were added to its board; in 1905 a syndicate headed by Matthews and Osler took over the western mining interests of George Gooderham* and Thomas Gibbs Blackstock, a high-risk move that led to the incorporation in 1906 of the CPR-controlled, Toronto-based Consolidated Mining and Smelting Company of Canada Limited, with Matthews as president. In the enterprises with which he was affiliated, Matthews played three roles: well-connected director, figurehead president, and well-capitalized financier. In no case did he actually manage an enterprise.
Since Matthews’s financial interests were so large and varied by the time of the merger wave of 1909–13, it was perhaps inevitable that he would be involved in two of the largest consolidations, the Canada Cement Company Limited and the Steel Company of Canada Limited. Along with Osler and Osler’s son and partner, Francis Gordon, he had been instrumental in financing the merger of two cement mills in Marlbank, Ont., and plants in Deseronto and Napanee Mills (Strathcona). The new concern, the Canadian Portland Cement Company Limited, was incorporated in 1900 and its administrative head office was moved to Toronto. Overnight, an operation situated in small communities and controlled by the Rathbun family became an impersonal corporation dependent on money raised by powerful Toronto capitalists, despite the fact that Edward Wilkes Rathbun*,owner of two of the plants and the pioneer who had successfully introduced the manufacture of Portland cement in Canada, continued as president and general manager.
The next few years would see the cement industry turned inside out. The upheaval was due to technological revolution, notably the use of metal reinforcement and the ability of Portland cement to support enormous loads and harden under water, and the construction of more plants by Canadian and American interests to supply the infrastructure boom of the early 1900s in Canada. Cement promoters came out of nowhere as money poured into expensive, ultramodern plants. Matthews and his partners responded by closing three of their mills, making improvements at the remaining one in Marlbank, and building a modern plant at Port Colborne, Ont., though by the time of completion it was already being outstripped by plants in Hull, Montreal, Calgary, and Exshaw, Alta. Then, disaster struck the industry. The financial panic of 1907 caused an industrial recession and a temporary halt in construction. Cement prices tumbled; by the end of 1908 Canadian production was exceeding consumption by some 25 per cent. Matthews’s group desperately looked for a way out. When approached by a syndicate of owners represented by promoter William Maxwell Aitken* who were trying to cartelize the industry, Matthews agreed to sell Canadian Portland on the condition that he receive cash for his assets as well as a large slice of the promotional stock in the new firm, which would be chartered as Canada Cement in August 1909. To the annoyance of the other owners when they discovered the truth, Matthews received $1.4 million for his two properties, the only owner not forced to accept securities alone as payment.
Of all the owners, Matthews had proved himself the shrewdest negotiator, surpassed in guile and acumen only by the young Aitken. Though both men viewed each other with suspicion, they were able to put their distrust aside to work together on a second immense consolidation. Matthews, again in partnership with E. B. Osler, owned a sizeable share of the Hamilton Steel and Iron Company Limited, and both were on its board of directors. With merger mania pushing up stock prices, they attempted to bring together a number of Ontario steel producers, but in the middle of negotiations, in 1910, they were approached by Aitken, who wanted to combine these companies with two Montreal producers. Matthews, who felt no compunction about folding the well-run Hamilton firm into a larger concern, wanted top dollar from Aitken for his share and a large part of the financial action in promoting and underwriting the shares of the new Steel Company consolidation.
Although Matthews received a good price for his interest in Hamilton Steel and Iron, as well as an inside track in financing the new company, he refused to give in on the price Aitken wanted for one of his Montreal companies. With negotiations seemingly deadlocked, Aitken put forward a compromise. He would accept what Matthews had originally argued was a reasonable price, subject to an independent appraisal. If it was lower than Matthews’s price, Aitken and his Montreal associates would pay the difference; if the value was higher, Matthews and his Ontario friends would pay. When the appraisal came in, Matthews discovered that he had been outfoxed by Aitken to the tune of almost $1 million. What he lost, however, he gained back in the merger promotion itself. He had secured a substantial piece of the very profitable underwriting of the new issue, and was left with enough common stock to make him the fourth largest owner in the new entity and a director on its board. Moreover, his interest went beyond this initial organization. During the recession of 1913 he ensured that the Dominion Bank extended a $1.2 million loan to the Steel Company to help it through the year.
These complex mergers certainly did nothing to harm Matthews’s sterling reputation, and few contemporaries ventured any critical examination of his solid corporate existence. In attempting to cut through to the sources of control within Canada’s banks in 1913, former cabinet minister Henry Robert Emmerson identified Matthews, based on his presence in 18 companies, as one of the 23 “capitalist-directors” who “are the directive forces in practically all of Canada’s economic life.” Others went further. In 1909 Nathaniel Samuel Fineberg had calculated in Moody’s Magazine (New York), from the sheer number of Matthews’s directorships (17), that he was the second most influential business figure in the dominion.
Matthews had all the characteristics of a successful businessman. Photographs portray a slim, bearded, neatly attired gentleman in the Edwardian mould. In affiliations he was a freemason, an Oddfellow, and a member of the Toronto Club and the St James Club in Montreal; in religion he was a Methodist. His philanthropic interests appear to have been limited to local musical events: he was president in 1903 of the National Chorus, conducted by Albert Ham*, and in 1910 he was on the Toronto executive of the dominion drama and music festival sponsored by Governor General Lord Grey. At his death he owned a summer place at Roaches (Roches) Point on Lake Simcoe.
In politics Matthews was a Liberal, unlike Osler, who was a Conservative and for several years an mp. With his many industrial and financial interests, all of which benefited handsomely from westward expansion, Matthews supported high tariff protection against the United States. This support posed no problem during most of the Laurier boom, but it did lead to a major rupture when the Liberal party began to move back to its old policy of free trade with a reciprocal, lower-tariff agreement with the United States, first proposed in January 1911. Laurier quickly discovered that the Ontario members of his cabinet were terrified of the reaction to reciprocity of industrialists and financiers such as Matthews. Labour minister William Lyon Mackenzie King*, for example, concluded that he and others in Ontario would lose their seats in the next election. Rarely outspoken on public matters, Matthews was one of the 18 conspicuous Toronto Liberals who signed an anti-reciprocity manifesto in February and then proclaimed their opposition at a huge public meeting in Massey Music Hall in March. Unlike some of the “Toronto Eighteen,” Matthews had unquestionably been a Liberal backer, so his decision actively to support Robert Laird Borden*’s Conservatives in the September election was a severe blow to the Liberals.
W. D. Matthews entered the war era comfortable at the head of numerous companies but, judging from his strong investment in Victory Loans, dedicated to Canada’s war effort. His wife died in 1917 and two years later a stroke followed by pneumonia claimed his life, and he was buried in Mount Pleasant Cemetery. He had carried life insurance in excess of $130,000, an extraordinary amount for the time. His executors had the largest component of his estate, his stocks and bonds, appraised at $3,651,800 but they were revalued by the Surrogate Court to $1,880,800, a casualty of the recession that followed World War I.
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