The Indianapolis journal., 1883-02-12
WHEN CLOTHING STORE.
rELEGRAPHIo CONSOLIDATION.
The Mutual Union Leased by the Western
Union Company.

New YORK, Feb. 10.-At a meeting of the
Western Union trustees they determined to
lease the lines of the Mutual Union COM
pany, guaranteeing the interest on the bonds,
and annual dividends of 1% per cent. on the
stock. This agreement was afterward ap-
proved by the directors of both companies
at full meetings of the boards. The Western
Union directors met shortly after noon and
the Mutual Union directors an hour or two
afterward. No opposition to the plan was
offered at either meeting, and the approval
Of the stockholders of both companies is ex-
pected to be given with the same unanimity.
The stock holders will not be called together,
but it is expected that they will express their
consent in writing. There is said to be not
the slightest doubt that the stockholders of
both companies will assent to the agreement
at once
By the terms of the lease it is provided
that the Western Union shall assume all the
obligations and contracts of the Mutual
Union; that it shall pay the interest on the
IS, 100000 of bonds, and a per cent. divi-
dends on the 10,000 600 share capital of the
company; and that it shall establish sink
ing fund of not less than $50, 900 year
towards the payment OF the principal OF the
bonds These charges amount to 100000
year, the interest to $780, 900, the guaranteed
dividends 10 $150,000, and the payment to the
sinking fund to 600 The earnings of the
company have been recently at the rate of
about 81 800 900 year, and the cost of oper-
ating its lines has been about two-thirds of
the gross earnings. A large reduction in ex-
penses is expected to be made by the prac-
tical consolidation of the company with the
Western Union. The offices will be united
as rapidly as possible and the number of OPP
orators reduced. A change in the offices will
probably not be made till May.
The Western Union officers say that the
cost of working the newly-acquired lines will
be very SMALL because that company will
not be obliged to increase greatly its present
force. The lease is to go into effect immedi-
atey. 1t is for 999 years. All the existing
contracts of the Mutual Union, both for the
sending of press dispatches and for leased
wires, are to be observed by the lessee COM
pany. The Mutual Union has large num-
ber of these contracts. The companys Off
GERS assert that all of them are sources of
profit, but it is understood that few of them
were objected to by the Western Union. No
exception was made, however, in the lease
ratified to-day.
The Mutual Union Company was chartered
in October, $780, The original capital of
5000 900 was increased to $4,000, 600, and its
lines were extended far beyond the first IN
tentions of its promoters 1t has now about
10000 miles of wire and it connects all the
principal cities between Portland Me-, and
st. Paul, Mimi, and Kansas City, Mo. A
majority of the company's stock was placed,
about FIVE months ago, in the hands of three
voting trustees. 1t was said at the time that
the purpose of the action was to prevent the
Western Union from obtaining control of
the company, by the purchase of stock. Jay
Gould had previously bought considerable
part of the stock, and the placing of the
control in trust was the signal for the begin
ming of numerous suits between the Western
Union and the Mutual companies. By the
agreement now entered upon all this litiga-
ton will be brought to close at once.