Richmond dispatch. [volume] (Richmond, Va.) 1884-1903, 1888-02-10
REORGANIZATION.
THE AFFAIRS or The CHESAPEAKE AID
OHIO RAILWAY. AM ft
A Circular Issued by Mr.. Huntinston-A
Syndicate Of Brokers-Whst Is
Recommended.
Especial telegram to tho Dispatch

NEW YORK, February &C. P. Hunt
ington, the railroad magnate, issued an
interesting circular to day, and in order
to understand it it is necessary to go back
to that time three months ago when
Wall-street men were startled by reading
in the daily papers that the Chesapeake
and Ohio Railway Company bad been
thrown into the hands of a receiver, and
that the receiver was none other than
General Williams c. Wickham, the vice
president of the road OF which Mr..
Huntington was president. This move
on the part of Mr. Huntington was re-
garded as a shrewd action to protect his
own interests at the expense of the mi
norlty security-holders who had declined
to acquiesce in bis plans concerning the
financial management OF this property,
whereby his claims upon it were to be
given precedence over the junior bonded
Indebtedness. They could othelp them
selves, however. Although against the
Huntington plan the minority made
a vigorous protest. They claimed
that the property had been grossly
mlsmanaged so far as they were con
cemfd, but adroitly handled for the
benefit of the Huntington interests !;
that Mr.. Huntington and his friends had
reaped the benefits they were not en-
titled 10, and that the road had not been
n good paying piece OF property simply
because it had been run in the interest
of the clique. 1t was alleged that one Of
the causes that made the road run be-
hind in meeting its obligations was
that the owners Of the road property
we're also the owners of valuable
coal-mines on the line OF the
road, and that they transported the
product of these mines to the seaboard
at rates which, while they enabled the
owners of the mines TO reap large profits
on their coal. were so low as to be ruin
Gus to the railroad property. While the
road was thus losing money Mr.. Hunting
ton was advancing money to it to enable
it TO meet its fixed charges, and thereby
he became not only the largest holder OF
securities but the holder OF Its notes for
these advances, and it is this floating
debt that the minority claim Mr.. Hun
tington is man@uyrlng to their detrl-
ment.
Mr.. Huntington issued q circular to-
day, in which be practically admitted
that it was because "a minority holding
bad refused to accept a scaling down Of
the interest on their bonds rs proposed
by HIM that he had taken the course he
had. The failure of the plan TO scale
down the interest would virtually depre-
ciate the value OF the notes held 10y him,
which represented merely q floating
debt. and it IS said that doubtless that
fear OF the depreciation of his own secu-
rites made him arbitrarily aud secretly,
1t is alleged, throw the road in the hands
OF a financial receiver.
Mr.. Huntington's circular announced
that a syndicate OF bankers had agreed to
reorganlze the property, and late IN the
afternoon Drexel, Morgan a Co. made
public plan which they recommended
to all classes OF security-boiders as one
that would be equitable to all interests
and which would place the company
upon a sound financial basis.
by Associated Press.l
NEW YORK, February sc. y. Hunt
inqton has issued a statement TO tue
holders Of Chesapeake and Ohio securi-
lies giving a. the cause for the steps to
be taken for the reorganization OF the
property that the minority of the holders
Of B bonds refused to assent to the
proposition to scale down the interest
lie states that the mortgage securing
So, Co., 600 bonds Will be toreclosed
and q new company organized. He
approves the plan Of reorganiza-
ton issued by Drexel, Morgan ~
Go. this afternoon. 1t will in
clude the entire line from Newport
News 70 Cincinnati, n distance of 60
miles, and the new incomplete river diyi-
sion Of 145 miles, and the bridge and its
important approaches at Coyington and
Cincinnati, OF which about q mile is
elevated track in the heart of the two
cities
A committee consistingof c. H. Coster
and \. j. Thomas OF Dreyel, Morgan *
Co., and L. J. Cross, of Morton, Bliss AZ
Co., has been appointed to carry out the
plan.