The Charleston daily news. [volume] (Charleston, S.C.) 1865-1873, 1871-03-08
The consolidation Business.

This paper has actively opposed the Bill
s:so promote the consolidation Of the Green
ssdlle and Columbia Railroad Company and
,s.the Blue Ridge. Railroad Company" better
known as the Consolidation Bill. Our main
objections, we're that the Bill enables the
Greenvine Ring to obtain possession OF the
four million of Blue Ridge bonds guaranteed
by the State that it allows those bonds to
be sold at any time aud at any price; that it
deprives the State of it's lienup both roads,
and, by permitting the Greenvilfe road to
consume the bonds of the Blue Ridge road,
max the completion or the last named
line practically impossible. The Bill, how
, ever, has become law, and, We are invited
to present to the public the reasons why the
measure was supported by the Legislature.
This we will cheerfully do:
l. The Consolidation Bill does not eonsol-
jGate, the two roads, but merely authorizes
their consolidation upon certain conditions.
1t is argued, therefore, that the stockholders
of the two companies viii sea to it that
neither road is gobbled up by the other.
While at this stage we may remark that 'the
ssstockholders" Of the Greenville road are
the Greensille Rings in whose straightfor-
ward integrity the people have very little
confidence. They will doubtless take care
Of their own interests but it is doubtful that
they will haye much regard for the welfare
Of the Blue Ridge road. This last named
road is virtually controlled by Governor
Scott and Mayor Pillsbury, who represent
the stock of the Company held by the city
and State. These officials can prevent the
Greenville Ring from obtaining control OF
the Blue Ridge bonds, and we are informed
that this is their determination.
2. The object Of the management OF the
Greenville road in asking to have the lien Of
the State postponed is, that the Second
Mortgage bonds, now existing on the road,
and in the hands Of the company, may be-
come First Mortgage bonds. With these
bonds it is proposed to pay off past-due
debt, and to pay for the iron and equip
'ments necessary for putting the line in first
rate condition. 1t is urged, moreover, that
the Greenville road, when properly ironed
and equipped, will not.oniy pay the interest
on its bonded debt, but will have surplus
which can be used in paying the interest on
the Blue Ridge bonds while that road is in
process Reconstruction.
8. The fact that the State had statutory
lien upon. the Bfhe Ridgeroad is saidto have
been one Of the difficulties In the way Of ne
gotiatng the Blue Ridge bonds. The mort
gage executed, and put on record, in the
several States through which the road ruins,
was made to be first mortgage on the prop
erty Of the company, while the otauthoriz-
ing the endorsement gave the State first
lien. But the purchasers Of the bonds do
sire that theirs shall be the first claim on the
property of the company. They cannot en-
force their claim in the courts, as against
the State, in any event, but, if the company
fail to, pay its. interest,", the holders OF its
bonds, freed from the State lien, could in-
stitute proceedings against the corporation
and so satisfy their denlaads. In the opin-
ion OF the friends of the Blue Ridge road it
was, therefore, absolutely necessary TO post
pone the State lien.
4. AS to the change in the law OF 1868 |
which gives the Blue Ridge Company the
privilege Of negotiating their bonds at the
market price, it is urged that the provision
in the act of 1868 requiring So, 600, OOe of
the bonds 10 be sold at par was permanent
bar against the negotiation of the bonds
upon their merits. The law might however,
have been eyaded by an arrangement of
commissions, or by using the fourth million
of bonds to meet the actual loss upon the
remaining three millions negotiated nomi-
nally at par. The restriction did not, more
over, prevent the hypothecati6n of the bonds,
nor would it appear to prevent the bona tide
holders Of such bonds from selling them
at any price if the money lent upon their
security was not punctually repaid.
8. The present management OF the Blue
Ridge road have for sometime advocated its
consolidation with the Grcenvile road, as