New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1875-08-25

The mNcsISatlon was aIonrneu I'LL IA D. Nj v" III
day.
THE FORECLOSURE OF A WESTERN RAIL-
ROAD.
PROCEEDINGS OF GERMAN BONDHOIDERs AGAINST
THE ROCKFORD, ROCK ISLAND AND ST. LOUIS
NEUTRALITY-SUSPICIOUS. OF II. OsTENBERG.
II. Ostenberg, editor of The German Ameri-
can Economist OF Fankfort-ontheMa Main, and the repre-
sentative in this country Of the bondhoders of
the Rockford Rock Island and ST. Louis Railroad, ar
rived In this city few days ago from Chicago. He will
leave to-day by the Algeria for Frankfortonthc
Main, where he win make full report to the German
bondholders Of all that has been done by him during tie
past twelve months in the foreclosure suit against that
railroad In conversation with reporter OF TIE TRIBUNE
last evening" Mr.. Ostenberg made the following state
ment:
The suit which brought against the Rockford ROCK
Island and st. Louis Railroad was really the hrst lore
closure suit that was ever carried IN this country
that Is much the bondhoders have insisted that
the former managers of the railroad and every one
else should give way to the interests OF the
mortgages, and have thus far succeeded in carry
ing their point. Notwithstanding all kinds OF
distractions that werc thrown in my way
in the comparatively short time of ten months,
ceeded obtaining final decree Of SALE which was to
have taken place Aug TO- and was in hopes that the
different railroads which have competing interest IN
getting possession of the Rockford, Rock Island and
ST. Louis Railroad would get up sufficient strife to cause
the latter to sell for fair price, On the evening before
the sale to have taken place. however learned that
ring had been formed by which it the intention to
manipulate matters in such way that the members OF
this ring should get possession of the road for mere
song.
therefore considered it to be to the interest Of my
clients have the sale postponed until Aug 10, when
bought in the ROAD for Sl320Oo0 OF which have PAD
100000 cash. and The balance Is to be paid upon the
of he nv he
early part of October, 1875. Immediately after hal
bought the road, offers TO me from several rai
road companies TO buy the road from the
bondholders. derutaticn from the cities
Of Rock Island, Davenport. and Molina also
came TO Chicago to invite Inc TO attend meeting ut
Davenport OF some moneyed men who wished TO Lave
tie road reconstructed and managed Ill Inc interest
Tho people living along the ne 81 the road Instead o
coal monopoly, as had been the case before
on the dGOTIg day ~ Th ss eSa
ing capitalists bankers and manufacturers OF that and
which do feel inclined to make public al pres n
shall lay their proposition. well as tie others that
been submitted to together with plan o. reGr
ganization which l have. worked out myself,
before the German bondhoideIs who meet IL
ibcr action The German 6ondnoders have
desire whatsoever TO make monopoly out OF tnis
railroad, do they wish TO show preference TO Glitter
of the connecting crossing roads. Neither do they
wish to have the exclusive control Of the road All they
money Which they hive ALREADY lost ana hat it
now necessary them invest in repairs in order that
The road may be put IN good running condition. 49,
From the very start, continued Mir Ostenberg, this
special scheme of the greatest frauds that was
perpetrated in this or any other country Almost
every one who had anything 10 GO with IL has naue
money out of the affair They have injured the American
tons which have been gotten up here since
1869. III 1871, when tne railroad was en-,
iirely bankrupt, instead Of turning the road
over 70 bOndholdrs the road was given over 10
party, who Of course feat under no OBLIGATIONS to
the bondEodss From the time the United states Court
appointed receiver, on Oct ~ 1874, everything when
they could possibly do has been done by the anagers OF
this clique cry down The property have no ieas,
however, OF being unable To maze the property pay
good dividend, three times he amount at which
bought IL in which Is only 81 600 per IIllc
Mr. Ostenberg asked how many OF Tie ponds OF the
road are held in America. He replied AS follows:
New.Yo-k banker, a certain Mr. Hassler. who is
neced with The railroad ring; about 200 more bonds are
iepresen ed by aS firm i'll Chicago; about 100 nave
been to the Union Trust Company, the trustees O1
cred over TO myself the owners Of which have joined
the German CCmniittee. This makes about SoVV,oOo
held thu country the total bonded DEBT amounts u
$9OOOOU0. exclusive OF iast due interest which lit
tie s. 900. The gross earnings OF TIC road have
BEEN So far, about 81 100000 per year and it requires
only fair management TO bring ii up 10 81 900 Wnin
the next two years Toe rail- Odd when uut In order
a net profit Of 50 cent on It's gross earnings,
In reply to the question as to wat the
bondhoid viii receive who have not jOLel the
German bondholders, he said Tie bonds numbered
from 10 5000 will receive about IL per cent and tDOse
above 5000 about Gig per icent Besides those III this
country, there some bonds heidi persons III Holland
and SwitzC Rand but the majority OF all the bonds are
held in Germany. After the bondho dcrs have invested
an additional 1900 900 or SlOOOUJ wicn all tnat VIII
lie the road in good running condition. II
win net 10 per cent on u, OOO, 900 to s4,OOO,OOO"