The New York herald., 1876-12-23
Views of Mr.. 0liphant on the Pro-
posed Amalgamation.
SHALL We HAVE A FREE CABLE? /?
Determined Opposition of the PubIc-A
Feasible Scheme

is thus rc-establshcd has met with the hearty in
dorsement OF leading bankers and merchants who
unwilling to submit TO enormous increase of tho
rates by tho proposed Anglo Direct amalgamation
monopoly. There is little doubt that tho 81, 900, 600
or SIS oOo 600 necessary to establish such indc-
pendent cable could be raised in very short time in
Wall street, that 1t is well established fact that
such free cable could pay atow rates. least fifteen
per cent the capital invested. II viii be
below that Mr.. Oliphant, tho manager OF the Direct
Cable Company in New York, makes this claim in a
calculation which is based libera! allowance for
working expenses. The deep interest which the sub
jcct Of proposed amagamaton has for the
public will insure wide publicity both sides OF the
TO the views OF Mr.. Ophant as expressed by
him in very full aud candid rsation with a re-
porter of the HERALD Mr. oliphant is well known as
a valuable correspondent OF the London Times IN
in whose service ho VISITED, several notable
sons, remote portions OF the globe. The present in
tcrview shows him TO bc man of delicate sonso Of
honor who is unwilling, after having repeatedly
promised, the part Of the promoters of the line,
that the Direct should always rcman free and nde-
pendent TO lend his voice to deliberate violation Of
companys faith distinctly pledged to the public.
The following is the material portion OF the inter-
view:-
REroRrER-What truth IS there in the rumor OF
possible amalgaination between tho Direct and Anglo
Gable companies?
Mr.. oLIrnANr--properly speaking tho present
movement is not for amaigamaton but for working
arrangement between the two companies with the
doubtless OF ultimately forcing amalga-
.'Who are the orginators OF the movement 20
at is originated by The Globe Telegraph and Trust
Company Of London This company, with capital of
Ga, 600 900 sterling formed with the idea that, by
purchasing the stock OF telegraph companies and aver
aging upon IT, they could guarantee permanent dyi-
companies in which they had invested. so tnat any
person owning stock In any ono OF these com.
vanioc fnr (lnha
guaranteed dividend OF six per cont. The
Board OF THIS company consists mainly
of directors OF the Telegraph Construction and Main
tenance Company, the Anglo American Gable Com
pany the Eastern Telegraph Company, the Brazilian
COMBINATION which asp,res to con,rol the telegraph
interest Of The world. The Telegraph Construction and
Maintenance company depenas ior It's existence upon
the success OF this combination through IL the
pany rctains almost exclusive monopoly OF the
ufac,ure oi cables. The only opposition which has
hitherto successfully competed with has been the
Drect Cable Company, whose cable constructed by
Mcssrs. Siemens Bros and 1t has become evident
that II the Direct Company succeed IN laying
second cable its independent stence is assured and
Mcssrs Scmens VIII compete with the Construction
for the OF cables under far favorable
conditions than that the company present enjoys
An extensive amovement has, therefore, been
on loot to crush out this dangerous opposition and
for that purpose the Globe Company commenced
threo four months 10 buy largely into tho Direct
Company, with the Wow Of controlling It's stock In
doing this II animated by another motive beyond
that of supporting the c0mOipaon have described
Their own enterprise hns BY no means proved
OF judgment great to bo almost inexplicabe
Thus they bought 81, 600 Of Anglo Coinpanys
large amount Eastern Telegraph stock, which has
In like deprecated, that they stand oso
between f700, 900 and fS00. 600 these invest
menIs alone This depreciation is doubt largely
OWING TO the opposition Of the Direct Company and il
has become matter Of selfpreservaton Tor the Globe
Company to destroy the independence OF the Direct.
BY forcing an amagamation they calculate that the
receipts and consequently the dividends of tho joint
companies would bc increased by high tariffs. ("
PROBABLE INCREASE RATES
"what do you suppose the tariff would be raised
tor"
sTo 81 so, or probably 81 a word, from the present
OF seventy-fivc cents with 81 word for press
messages. instead of twenty-five cents Experience
has shown that certain amount o! cabling must be
done, matter what the rate Is, and calculations
based upon low rates producing increased cabling,
have always proved delusivo.n
"Have tho Anglo made direct ofcr Of advan-
tageous terms to tho Direct company they will enter
.Mr. Pender Chairman Of the Globe, has announced
that the Anglo Board Will agree 70 the terms pro-
posed by tho Gobe.'
"Are you at liberty to say what those terms arcp''
''No. but no terms which II would bo possible for
the Anglo 10 offer would be advantageous or the Direct
10 accept A circular has been ISSUED by OF the
Direct shareholders in which he adducos excellent
sons why the Direct Company should remain independ
ent aud shows how fatal would be for them to be de-
luded into parting with their freedom. The share
holders OF tho French company certainly rcgrot tnat
they were seduced into adopting this policy"
Il understood that you were prohibited by your
charter from entering into any working arrangement
with the existing companies" I"
! $50 We are The memorandum OF association on
which the company was founded expressly provides
that the company shall not amagamato with,
| cable company hence the first step which would
have to be taken II the policy of the Globe is TO be
carried out would be to liqudate the company and
constitute IT under new name and with this clause
omitted There no way OF repeating IL. as an act OF
Parliament forbids any such change In company's
memorandum OF association"
LEGAL DIFFCrLTIKs WAY.
"Could liquidation under these circumstances be
| carried outr'
Il ihlnk there would bc great difficulty in dong it,
| The minority who remained in favor Of the indepen.
dcnce Of the company would certainly bring the
into court and doubt whether judge could be found
who would counenance the liquidation OF a company
earning divicnd at the rate OF nine per cent Tor
shareholders, the manifest object OF the liquidation
beng to evade legal obligation which the company
| had entered into on its formation"
.'Are the present Board OF the Direct Company op-
posed TO or favor OF the scheme proposed BY the
..lhcy arc all men OF the highest honor and that
answers the question. They became directors OF the
company ON The distinct obngation, as contained
memorandum OF association not To participate in the
profits OF any existing company, and doubtless they
viii not lend themselves 10 any movement which dis
uncty aims al evadng that Obligation. For my
part should feel my honor seriously compromised ii
did not oppose II TO the utmost Of my power"
GROSS BREACH
~ consider It involves gross breach OF faith, not
merely to the telegraph compares America,
VINO nave made contracts with this COM
| pany, but 10 the public at large The
| fact that clique who have bought
what turn ont TO controlling interest tho
stock, do not feel themselves either morally legally
bound to carry out the obligations OF the company,
may be matter of serious regret so far as they
concerned, but only renders !, more important for
those who have different standard Of right wrong
| to ct upon H."
sWhen will tho matter be scttlcd?'
| ''Whcn the extraordinary meeting of shareholders
takes place to consider H. rcqusIon to call such
meeting has been in TO the Board the day has
not yet been nxed''
TnE mrRALD's PROPOSAL IxpoRsED
'Whatdo you think Of the HERALDs proposal to
let the merchants and bankers start cable IN
case the ninalgamaton is eiicctcdfn
u am very glad to see the HERALD take this posi-
ton. As the capital OF the Anglo by this ANAL gamn-
ton will have swollen TO nearly 60 0OO 600,
cable now takes twenty-six per cent OF the whole
traffic. u vs. evident that another cable, which could be
laid Tor less Than fl,O00 000 would get at least
much business is absorbed by the Direct Cable,
nna with small capital II could afford TO put rates
down 10 point utterly ruinous to line which has TO
| pay dividends on SO 000, 900 and would still pay O
handsome profit There could be no better spccula.
ton Imaginable than that proposed by the HERALD.
| large share of the Board of the Anglo
| convinced OF this fact, and hence | think