Magnatone Guitars!

New for Fall 2013, a complete guide to Magnatone guitars and the stories behind them!

1938-1960 Steel Guitars

1956-1963 Bigsby/Barth Era

1964-1966 Starstream Era

 

Estey, Minshall, and Rieger

In researching Magnatone, I've come across some interesting organ company history that doesn't seem to be widely known. While it's too much back story to include as Magnatone history, it seems too juicy to moth-ball it.

For fellow historians, this page is devoted to the intertwined, post-war stories of Estey, Minshall and Minshall-Estey, and Rieger organ companies.

Estey (1950-1959)

The original Estey Organ Company of Brattleboro Vermont was a pipe and reed organ manufacturer that started in 1846. Estey was a big part of Brattleboro, and when investors came in for an attempted rescue in the fifties, fans of Estey and locals would ultimately be deeply saddened to see it's final days unfold as it did, with the Estey name getting hi-jacked by outsiders and in 1961, the doors of the Brattleboro plant getting closed for good.

At that point, what Estey had become had nothing to do with its history, other than the name. It was really with immense gall that the 1961 Estey Electronics executives, who likely never visited Brattleboro, boasted that they represented over 100 years in the organ business. Of course, they made these boasting statements in both marketing literature and, more importantly, to potential creditors and investors.

You can read about the old Estey company at The Connecticut River Joint Commission's historical register and www.esteyorgan.com. These sites cover the history of the company quite well up until the point that it turns rather dark in the fifties. Of course, the Magnatone story and Estey's path became intertwined in 1959 when Magnatone's F. Roy Chilton took over. But this wasn't the beginning of the end. In fact, that was only at the tail-end of a near ten year collapse of Estey.

Estey: 1953

In May of 1953, a majority stake of Estey stock was sold to Rieger Organ Inc. of New Jersey. The Estey family had just recently been able to regain family control of the company, but Rieger became majority shareholder when it took title to the shares owned by Robert H. Cochrane Jr., Mrs. Jacob Estey, Wilson Estey, and Mrs. Alice Blair. All of these shares amounted to 77% ownership. All Estey personnel was initially retained, including some Estey family members as well as (for the time being) Premo F. Ratti, Estey's president, general manager, and treasurer.  [1] 

Soon thereafter, Henry Hancock, then president of Rieger, installed himself as President of Estey. Hancock, a Pennsylvanian by birth, had spent most of his life in Austria, where he was hired by the 100 year old organ manufacturer, Rieger Ogrelbau.

Estey: Electric Organ

Under Hancock's watch, Estey had grown to employ about 300 people by 1955 (nearly doubled since the Rieger take-over). In the engineering department, Hancock was able to persuade noted German engineer/pioneer, Harald Bode, to immigrate to the US and take over as Chief Engineer and to develop an electric organ for Estey. In the summer of 1954, Estey announced an electric organ at the NAMM show in Chicago. Estey's leap into electric organs may have also been influenced by a relationship they shared with nearby Minshall Organ Inc. The Estey development of an electric organ certainly severed the friendly relationship Estey shared with Minshall (see below).

Estey: Fraud Charges and Bankruptcy

Another individual that would turn out to be a key player in the Rieger/Estey story was the new Vice-President Elizabeth MacKay. Mackay came over from Hammond Organ where she had been in charge of merchandising for at least ten years.
 [2] 

At some point, Hancock got a rather substantial investment company, Eastman-Dillon, to invest (That might have been how Hancock raised the money when he made the original purchase), but in 1955, Eastman-Dillon sold their stake to the Value Line Fund.  [3] 

Its about this time that things really go downhill. Estey entered into bankruptcy protection soon after. Hancock and MacKay were kicked out in March 1956. The entire operation shutdown on April 29, 1956. Estey entered into the receivership of Barnett Herrick Co. of New York, and one of its agents, Frederick Chapman, was made president and a member of the board of directors.

Around this time noted New York financier Arnold Bernard came in and attempted a rescue operation. Actually, Bernard already had skin in the game, as he owned and operated the Value Line Fund. It is important to note that Bernhard was not a engineer or musician, he was strictly a finance guy. At some point Bernhard assumed majority ownership and appointed himself chairman of the board.

Somewhere in this whole mess, ex-VP Elizabeth MacKay was locked up and had to post $200,000 bail. Bernhard and the new-new Estey Corp. filed a civil suit seeking to recover $800,000 which it claimed to have been the value of Estey assets alleged to have been lost to the firm through the actions of Miss MacKay.  [4] 

Later that same month, Raymond S. Roberts, a local member of the board of directors, was elected President of Estey as Chapman stepped aside. Robert's local business ventures included the Raymond S. Roberts Company, Inc. operator of the E.J.Roberts & Sons Garage. Roberts took over the operation.  [5]  Things seemingly looked bright for Estey as it announced plans to have its first electric organ as a finished production unit later in October.

However, things were not turning out well for Hancock and MacKay either. Besides the civil suit, they there charged with fraud in US District Court.  [6]  In October 1958, Hancock was convicted of mail fraud in borrowing $250,000 from Guaranty Trust, Co. (today, J.P.Morgan) based on false financial information. At the time of conviction, MacKay was facing similar charges as well.  [7]  This wasn't Hancock's only legal trouble, be sure to read the section on Rieger for the details of other problems he had made for himself.

Estey: Magna merger

This is where my Magnatone history originally picked up on the saga that was Estey. Bernhard found someone to buy controlling share of Estey on the spring of 1959: F. Roy Chilton and Magna Electronics of Torrance, California. Estey seemed to be in good shape! The $177,500 cash deposit in Vermont Bank & Trust (presumably Magna's cash purchase amount) was enough for a US District Judge to release Estey from bankruptcy. There was about $700,000 in outstanding debt at the time, but the creditors who held those debts against Estey, elected to to have that debt be converted into Estey stock. Chilton announced plans to continue production, but history has shown that those announced intentions were unlikely to be genuine.  [8] 

Estey: Post final plant closing

The actual closure of the Brattleboro plant was some where between late 1959 and and late 1960. George Mason purchased the old Estey Organ Shop from Estey which had closed all operations earlier that year. Mason announced plans to lease the facility to a woodworking business.  [9] 

Elizabeth MacKay brought a suit in 1963 against Estey Electronics, which is what Estey Organ became in a 1961 merger with ORCOA. MacKay sought $1 Million in damages and contended that a conspiracy had been hatched in 1955 to seize control of the board of directors, discharge her (and Hancock) from emplyment, and cause a false fictitious and improper valuation to the made of the companies assets as to devalue her share in the company.  [10] 

Minshall-Estey

Estey's leap into electric organs was certainly influenced by the relationship they shared with nearby Minshall Organ Inc. Minshall entered the organ market with tube based electric organs (read more here), in Ontario, Canada and opened a plant in Brattleboro in the forties. Minshall's founder and namesake was Burton Minshall, a radio repairman who initially engineered and built his first organ for his wife.

I'll speculate that Minshall's choice of Brattleboro for a US-based manufacturing center was due to proximity to Estey, and for the purpose of buying organ sub-assemblies from Estey. Estey didn't have prospects in the electric organ market in the forties, and Minshall had no desire to get into reed organs so such a relationship would have been mutually beneficial arrangement. Minshall became Minshall-Estey at some point before 1950, but by March 1954, Minshall-Estey became Minshall and severed ties with Estey.

Burton Minshall, president of the Minshall-Estey Organ Inc. Brattleboro, Vt. has announced that the name of the company has officially been changed to Minshall Organ Inc. Mr. Minshall said the change was made to avoid any confusion with the name of any other company. -- press release  [11] 

Further speculation suggests that Minshall changed the name when Hancock made plans to build his own Estey branded electric organ. Another possibility is that Burton Minshall and Estey's new President, Henry Hancock didn't get along, and following the severing of business ties, Hancock launched his plans for an competing electric organ (still, this is speculation!).

What became of Minshall? The inventor and owner, Burton Minshall fell under ill-health around 1955. In April of 1956 he sold his interest to Donald S. Sammis of Stratford, CT. While on vacation with his family in Switzerland, Minshall died at the age of 49 in Feburary 1957.  [12] 

Rieger Organ Inc.

Henry Hancock was born in Pennsylvania but spent most of his life in Austria, where he worked for Rieger  Orgelbau, an Austrian organ company that dated back to 1845. After World-War-II, Austria was divided up and administered by the United States, England, France, and the Soviets. The Rieger factory, unfortunately, sat in Soviet territory, and the Czech government appropriated the factory and deported the owners and workers to West-Germany.

Rieger's owners, the Glatter-Götz family found friendly partners in the town of Schwarzach, Vorarlberg, and set about building organs under the name Reiger Orgelbau.  [13] 

Henry Hancock began to warn Josef Glatter-Götz of the Soviet's plans to move westward and managed to convince him this was strong possiblity. Hancock then suggested that in such an event, the Soviets would appropriate all intellectual property and patents recently development by Rieger, and that Glatter-Götz could protect his interests by sending Hancock to the United States (where Hancock was a citizen) and let Hancock establish a presence in the United States, and register all the patents with the US patent office. Furthermore, Hancock convinced Glatter-Götz that these patents would be held in trust and would be surrendered to Glatter-Götz upon demand. In return, Hancock asked for a ten years exclusive right to distribution of Rieger Orgelbau organs in the United States. Given this recent turmoil, Glatter-Götz was pursauded, and unfortunately agreed to all of this without consulting legal counsel! This was in 1950, Glatter-Götz did, however, sipulate that Hancock would only sell Rieger organs, and no competitor's organs.  [14] 

In March 1952, Hancock applied for the patent with his name as the assignor, and in June 1953, Hancock incorporated Rieger Organ Inc. in New Jersey. Of course, Hancock's verbal agreement with Glatter-Götz was for distributorship and didn't include any manufacturing. It was also without Glatter-Götz's knowledge or consent that Hancock's arranged to purchase Estey Organ Co. of Brattleboro, VT.  [15] 

All of this, of course, is Glatter-Götz's side of the story, all outlined in a 1955 civil suit naming both Hancock and Estey Organ as defendents. Glatter-Götz further suggests that a prospectus issued by Estey (after Hancock was majority owner) contained fraudulent statements about Hancock having extensive experience in the organ business in both Europe and the United States. This prospectus was issued just prior to an Estey common stock issuance.

What a disaster! Of course, at the same time, Hancock was being charged with fraud in Vermont for business practices he under taken while running Estey.

Reference

[1]: "Future of Brattleboro Organ Company Assured" North Adams Mass Transcript Mar 12 1953. "Estey Organ Corp. purchased by Rieger" Music Trade Review. May 1953.

[2]: "Made in Vermont" Benningtion newpaper. Jan 27_1955.

[3]: SEC News Digest, Apr 19 1957.

[4]: "Around Vermont, Bail Hearing Oct 1". North Adams Mass Transcript Sept 12 1956.

[5]: "Raymond S. Roberts elected president of Estey Organ Corp." North Adams Mass Transcript Sept 27 1956.

[6]: "Fraud Indictment for Henry Hancock" Nashua Telegraph Mar 07 1959.

[7]: "Find Hancock Guilty in Fraud Case" Bennington Evening Banner, Oct 24, 1958.

[8]: "Fresh Start With Million" North Adams Mass Transcript Apr 21 1959.

[9]: "Mason Buys Estey Organ Shop" North Adams Mass Transcript Nov 3 1961.

[10]: "Files Suit for $1Million" North Adams Mass Transcript May 2 1963.

[11]: Music Trade Review 1954.

[12]: "Burton Minshall, 49, organ official, dies" North Adams Mass Transcript Feb 13 1957.

[13]: Wikipedia

[14]: Supreme Court Appellate Divison, First Department. Index Number 8957. 1955.

[15]: Supreme Court Appellate Divison, First Department.

DA/MagnatoneAmps.com

 

 

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