The Sun.
London, England, 1867-05-31 00:00:00

GLASGOW AND SOUTH-WESTERN.

An extraordinary general meeting of this company
was held in Glasgow on Wednesday—Sir Andrew
Orr presiding—for the purpose of considering the
bill now before Parliament for amalgamating the
company with the Midland.
The CHAIRMAN stated that the bill had passed
the committee, but had not been reported to the
house, so that the meeting could do nothing but ad-
journ till Tuesday next. lie took the opportunity
to express his regret that some shareholders still
objected to the amalgamation, and hoped that oppo-
sition would cease, as it was the company's interest
to come to a speedy issue in the matter. The direc-
tors had received the report of the accountant
authorised to examine the affairs of the Midland,
and that report showed the English company to be
in a thoroughly sound and correct position—in the
most solvent condition that it was possible to con-
ceive any company to be in at the present moment.
A motion for adjournment was agreed to.

GRAND TRUNK OF CANADA.
The adjourned half-yearly meeting of this coin.
pany was held yesterday at the London Tavern

Mr. E. W. Watkin, M.P., in the chair.
Mr. J. M. Grant, the secretary, having read the
notice of adjournment, and also the special report of
the directors, an abstract of which has appeared in
Ike Sun. _ _

The CHAIRMAN said the object of the proposal the
directors made in that report was to increase the net
profit of the undertakibg. The plant was insuffi-
cient to develope the traffic on the line. lie asked
them to keep that point in their minds, and if the
directors were right that with the present stock of
engines, carriag2s, and waggons they could not
materially increase the net traffic of the company,
it would be requisite to devise some plan by which
they could obtain the additional rolling stock and
plant to enable them to increase receipts and to
pay the whole of the interest on all their bonds.
Every one of the bondholders in the company
would be benefited by the increase of the net

profits. The more the net profit was increased the
better it would be for the first, second, third, and
fourth bondholders, and when the profits covered
the dividends on the last, the original stock-

holder might EOOll expect some dividend. They
had all an interest in the increase of the net profit.

The postal and military bondholders had at presen
nothing more than the receipts from those sources
to pay interest on their bonds. He thought it was
a very unwise position for the concern to be obliged
to assign a part of its revenue to that purpose. It
was taking the receipts so far out of their hands, and
was a form of payment that ought to be got rid of.
They had endeavoured to reconcile those interests
with others. The postal and military bondholders
had got in the past year about 4 per cent., the in-
crease being caused by the Fenian outrages, which
had been a misfortune to the other interests in the
company. The usual average interest was 3 per
cent., on those. bonds, but by the scheme proposed
the postal and military bondholders would get £3
123. per cent., being 12s. per cent. more than the
average of preceding years, and Bs. per cent. less
than they had in the past year. The Equipment
Mortgage Bond clause in the Arrangements Act
limited the amount of these bonds to £500,000, re-
deemable in 15 ye.irs, with interest at 6 per cent.
per annum, having a first charge over all other pre-
ferences. The money was authorized to be raised
for providing additional siding, rolling stock, eleva-
tors, &c., to develope the traffic. Ile had to ask
them authorise the directors to go to Parliament for
permissive powers to raise additional capital for
those purposes, and towards which they would have
the postal and military revenue, estimated at
£40,000 or £50,000 a year. By giving the postal
and military bondholder 12s. per cent. more than
the average of preceding years, they would get the
postal and military receipts into their own hands.
There could be no doubt that those items of revenue
would increase in amount in future years, and the
result of the proposal would be that the postal and
military bondholder wouldget7-17ths instead of the
whole amount to which he would be entitled under
the present arrangement. The equipment mortgage
bondholder would benefit by that plan on any sum
ranging between the £soo,ooo:and the £1,700,000
proposed to be raised under that head, or he would
be damaged if the net profit did not increase, but
this was contrary to all their experience, and with
the anticipated increase of net revenue the position
of the equipment mortgage bondholder must be im-
proved in every way to his advantage. The desire
of the first preference holder would be not only to
receive his own interest as soon as possible, but that
the second, third, and fourth bondholders should
also receive their interest, because it would enhance
the security and value of his own stock. The inte-
rest on the present £500,000 equipment mortgage
bonds omounted to £30,000, and the further amount
of interest when all was paid up as proposed would
require £72,000 more, making £102,000 a year,
which the interest would probably amount to at the
end of five years for the present equipment mort-
gage, the £lBO,OOO to be raised, and the postal and
military bond charge. None of them would then
have any ground of complaint, because it was rea-
sonable to suppose that the traffic receipts by that
time would be greatly increased. Every additional
engine to the rolling stock required to develope the
traffic would earn nearly twice its cost in gross re-
ceipts in the year. If the engine cost £2,000 the
increase in the gross traffic would be about £4,000,
leaving about £2,000 net profit. They had 298 en-
gines on the line, and if they calculated twice their
cost, it would be about the amount of their earnings
in one year. An additional engine would therefore
earn the whole of its cost in about 15 months, so
that it would be well worth while to gradually and
judiciously increase their rolling stock, as the direct
effect would be to increase the net profits of the com-
pany. The committee of bondholders who conferred
with the directors on this matter held in the aggre-
gate £4,000,000 of bonds. If any gentleman pre-
sent had a better scheme for adoption, they would
adopt it instead of the directors' scheme. It was the
interest of all concerned that the interest on every
class of bond should be paid in cash as soon as pos-
sible. If the proprietors thought the scheme a
good one, he asked them to adopt it, and give
the directors their sanction to apply to the Canadian
Parliament for permissive powers to carry it out.
The proposal could not be carried until the act was
obtained, nor until each class separately approved
it by majorities of three-fifths of each represented
at meetings specially convened for the purpose. He
concluded by moving a resolution to the effect that
powers be applied for in the ensuing session of the
Canadian Parliament to convert the postal and
military bonds, £1,200,000, to equipment mortgage
bonds, at a rate equal to 60 par cent., or £720,000
of equipment mortgage bonds bearing a fixed rate
of interest of 6 per cent., and to raise a further
sum of £480,000 equipment bonds for the purposes
of the company ; the whole issue of those equip-
ment mortgage bonds then being £1,700,000 payable
first out of the postal and military revenue, and
second, if need be, out of the general net income ;
and that the act be subject to the consent of the
postal and military bondholders, and to a vote of
three-fifths of the bond and stockholders present at
special meetings of each. Also that powers be ap-
plied for to change the name of the company to
" The Canadian Railway Company."
BARIIG, M.P, a director, seconded the motion.