Daily globe. [volume] (St. Paul, Minn.) 1878-1884, 1879-09-24

LOBE. WEDNESDAY NC
Tic st. Paul, MJnneapoEts q MGnttoba
R0jltCON.
From the Montreal Gazette.]
This is the present title of the railway,
whose acquisition by Messrs Geo. Stephen,
D. A. Smith, and two other gentlemen of
Canadian birth, has excited - much Gu
riosity among the general public, and 80
much interest among persons concerned in
the fortunes of the Bank of Montreal. It
may be proper, on this account, to give
some little account Of it and its. recent for
tunes. To begin then, the road consists of
two branches, united however at both ends.
What We may call the main or more north
erly branch begins at ST. Paul on the Mis-
sissippi river, runs thence along the river
in q northwesterly direction to st. Cloud,
and then diverging to the westward
for "a time, gradually runs up
toward the north, and finally strikes the Red
river at q place called St. Vincent, just on
the border of the Canadian territory. The
southern branch leaves that what we have
called the main line. At Minneapolis and
takes direction nearly due west for about
half its distance. Thence it bends up again
to the north and unites with the main line at
place called GAINESVILLE. The entire, sys-
tenn will make q length of 670 miles mot q
very uncomfortable property to merit the
title bestowed upon it by the London Times
"of an obscure Canadian railway which,
besides, has not one inch of it's track on
Canadian soil. The original promoters Of
the various parts Of this system Of roads re-
ceived very great land grants IS en-
encouragement for it's construction; but,
after borrowing large Sums of money on
bonds, they found it impossible to complete
the undertaking, and in March of the year
1873 suits for foreclosure of all the property
had been undertaken on behalf of q commit
tee of Dutch capitalists, who we're the hold
ers of these securities. It was then that the
Canadian syndicate, under whom the owner
ship of the road g. had been
recognized, stepped J lin and of
fered tor purchase the interest of the
mortgages. The association consisted OF
Messrs. George Stephen, D. A. Smith, N. w.
Kittson and Jas. j. Hill, and We are author
lied to say that no other person had any
interest whatever, direct or indirect, in the
enterprise. Considering their nationality
the fact that the road is entirely American
and the vast property which has virtually
come under the control of these gentlemen
the operation may be not improperly desig-
mated as the romance of railroad financing
From copy of the original agreement fol
the sale which is now before us, we learn
that the purchase consisted of bonds to the
amount of $4,000, 900, owned at that time
by Messrs. Chenet g. Weetjen, Kirkhoven
and other capitalists of Amsterdam. These
were bought at prices ranging from eleven
to seventy-ive cents per dollar on their pa,
value. This covered all the property held by
these mortgages, including the enormous
land grant. The conditions were that the
foreclosure suits should be prosecuted with
all possible vigor, and that payment should
be made within six months after final iudg.
ment in the last of them. The purchasers
were also to complete the roads by means OF
newly organized company. Inathe mean.
time, the bonds were deposited with trustees
for the benefit of all concerned, and the pur.
chaser paid into the hands of the same trus
tees sum of money on account, which was
to be forfeited if they did not fulfil their en-
gagement. 1t was, however, further agreed
that, as in pursuit of these objects the buy.
era contemplated the organization of new
company,the sellers might at their election re-
ceive, in lieu of cash, first mortgage bonds ani
preferential shares of the company thus tt
be formed: The foreclosure having beer
accomplished, and the company organized
under the name of the st. Paul, Minneapolis
& Manitoba Railway company, new bonds tx
the amount of $4,000, 900, as stipulated fo
in the agreement with the Dutch committee
were issued and successfully negotiated il
New York. A portion was reserved for dis
tributioA among the holders of the origina
st. Paul & Pacific bonds, who preferred t,
accept payment in that manner and the pro
ceeds of the others met the cash payments
1t will be seen from this statement that tn
means by which the property came into tn
possession of the associates did not necessa
rily require the employment of very larg
cash funds. In fact, we believe that Their
was no necessity for very extensive loans TO
its acquisition. The purchasers raised wha
money was wanted from various sources, on
of these being the Bank of Montreal. w
are assured, however, that the loans from th
latter institution were neither unusual il
character nor amount; that they were mad
in the ordinary way of business; that the
were largely covered by securities, independ
emit of the railway; were profitable to tn
bank, and promptly discharged at maturity