Green-Mountain freeman. [volume] (Montpelier, Vt.) 1844-1884, 1881-01-19

THE TELEGRAPHIC CoNsoLIDATIoN.-I
The consolidation of the three great lines
of Geographic communication is an event
which is OF the first Importance, whether
regarded from purely financial stand,
point or in its broader public bearings.
The new consolidated company is to 10
tain the title of the Western Union Iele-
graph company, with capital OF Soo,,
100000, and that new certificate OF
incorporation is to be filed in accordance
with this agreement. The prices at which
the Western Union, American Union, and
Atlantic and Pacific stock are to be pooled,
are variously set down, but that the first
named stock is merged at about par,
the American Union at aboat W. anu
the Atlantic aud Pacific at about 81, seems
to be probable. The capital stock of the
Western Union company according to the
report issued in October last Is S4l ,O!3,'
4lO, of which $5S, $3.50 are in the
companvs treasury. It's bounded debt,
less sinking funds, amounted then to
S6, 096, 229. "a, and it owned stocks OF
o her telegraph and cable companies of
marke value of nearly $7,0O0,0OO Among
these are II 900 shares-about tive-eightS
of the capital stock-of the Atlantic and
Pacific Telegraph company, with which it
was practically consolidated on August
20, 1877. The American Union company
was Incorporated April 20, 1879. with "a
capital stock of $l0000000 the great
bulk of which is owned by Mr.. Jay Gould
personally. The capital of the Atlantic
and Pacific is $l4,000,000. AT a valuation
of SO per cent its capital would be 81 ,00O,-
900 in the consolidated company. The
only bonded debt the consolidated com-
pany would have would be the So, 264 ola
Western Union bonds now outstanding,
but the Western Union now holds as an
asset more than half the stock of the
Atlantic and Pacific company, as above
stated, and will therefore receive more
than half of the new stock to be given 10
that company. Up to the present the
Western Union has been obliged TO hold II
ma jority of the stock of the Atlantic and
Pacific to pre- Jerve intact its pooling con-
tract with that company. When the
Atlantic and Pacific becomes a part of the
Western Union that necessity will cease,
and considerable fraction of its own new
stock will be applicable to its sinking
fund. Should the company realize any.
thing like par for those shares the opera.
t lion will be an exceedingly profitable one,
8 tor the Atlantic and Pacific shares held by
, it have been carried as an asset, at a
valuation of $l,806,2 $50. The immediate
effect at the financial centres has been tC
c cause in advance in all telegraph stocks
: This is indicative of the very natural
: belief that the consolidated stock will pay
; higher dividends than he stocks of the
i three competing lines paid to their hold
g ers. Pleasant prospect for the stockholders
| but it involves an ominous hint to the
Y public of higher rates. There is no question
Q that the American Union company, whose
e lines were only opened on January 26
\ 1880. had proved II formidable competition
! to the Western Union, and in the year o
i, its independent existence it had don't
A much to reduce the tariff on messages. Il
3 had secured large stock, and had made
3 contracts for the laying of two more
e European cable lines. which would have
broken the high rates on foreign mes
4 sages. With this consolidation 1t seems
, only too likely that this fair prospect o.
/ cheap telegraphy will, temporarily al
least, disappear.