St. Paul daily globe. [volume] (Saint Paul, Minn.) 1884-1896, 1889-10-05
HILLS TRUMP CARD.
The Old Manitoba Railroad
Will Soon Be No
More.
It Is to Be Swallowed Up in
the Great Northern
Railway.
The Most Gigantic System Of
Railroad in the
World.
There Is More in the Deal
Than Appears on the
Surface.

name, which has long been misnomer,
will cease to exist. How many other
roads will be absorbed remains yet to
be seen. The scheme is the product of
the brain of the Manitoba magnate and
sprang therefrom, full-grOWn and in
fighting trim, as did PalIas Athene
from the brain of Jove. 1t Is the fore
cast shadow of this coming event which
has caused the remarkable rise in
Manitoba stock. The announcement
had a rather dampening effect upon the
stock, which sagged Off three points,
holders evincing an uncertainty as to
their opinions and tendency to unload.
A new company will be formed under
the name of the Great Northern Railway
OF Minnesota. To this will be leased
the Manitoba road.wi all it's branches
and appurtenances. The authorized
capital stock of the new company will
be $40. 100000. Of this S12.00O,0O0 will
be preferred stock, entitled to dividends
as such at the rate of 6 per cent per
annum. non-cumulative and free from
taxes. No addition can be made to this
preferred stock without the consent of
the holders of three-fOurths of the pre-
ferred stock outstanding. The balance
OF the stock, S2S,0O0, 600, will be held
'.by the Great Northern railway, sub
ject to future disposition for its bene-
fits" The S40.000,0O0 are offered
at par to the stockholders of
the option of taking one share of Great
Northern preferred stock for each share
of Manitoba stock owned by him on
Nov. Is prox. They will be required to
pay $50 share in cash, the balance
being paid by the transfer to the new
company of certain assets amounting to
S22, ,OOO, 900. subject to the collateral
trust mortgage of $4,000 ~, which will
be redeemed by the Great Northern
Railway company. Bonds secured by
this mortgage will be accepted on ac-
count OF subscriptions to the preferred
stock. All the stock of the Manitoba
road and Northern line of steamships
will be deposited in trust for the bene-
fit of both companies. The Manitoba
road will lease all of its roads, rolling
stock aud other chattels to the new COM
pany for a period OF not less than
ninety-nine years, the new company
agreeing to pay sufficient rental to
guarantee dividends on the $20,000,000
of Manitoba stock at the rate of 5 per
cent, payable quarterly. The Great
Northern Railway company will guar
antee all the obligations of the Mani
toha, and indemnify it against all liza
bilities.
Such is an outline of the scheme which
the fertile brain of j. j. Hill has been
gestating for some time. The publica-
ton of the circular giving details
caused considerable comment among
railroad men yesterday. The general
opinion seems to be that there is much
more behind it than appears on the face.
In the first place it, doubles the capital
stock OF the Manitoba road. The last
annual statement of this road showed
heavy falling Off from its receipts of
last year, and was more than disap-
pointment to every one. The reason
Tor it's loss is to be sought in the fact
that the extension of the road that runs
out into Montana is in a region
of country that is absolutely unsettled.
While there is good local traffic in
parts of Northwestern Dakota, the di-
visions from there west to Great Falls
are practically uninbabited save by
few prairie dogs The through traffic
between here and Helena is not large
enough to make such line pay. That
1t is Mr.. HIPS ambition to reach forth
his arms to the Pacific coast is we'll
known and admitted. A project with
this end in view has been outlined in
these columns within the last few days.
This increase of capital it is thought
will enable the road to be completed to
the coast. A -tranScOntinental road
might pay, where one stopping short of
the coast would not.
But it is hinted by men at Mr.. Hills
right hand that the new road is likely
to absorb a good deal more than the
Manitoba. That it will take in the
Eastern Minnesota and Montana Cen
tral there can be no doubt, as these,
though Ostensibly under separate
management, are part and parcel OF the
Manitoba. Sir Donald A. Smith and
S.r George Stephen have their fingers in
Tue pie. This probably means that the
Duluth, South Shore q Atlantic and
Minneapolis S Sault Ste Marie will be
gObbled up. By its alliance with the
Canadian Pacific this would form the
most gigantic system Of rail
road in the world, and when ex-
tended to the Pacific coast, as
reliable information states Will be
done sooner than most people expect,
would form a chain of roads such as
was never dreamed of few years ago,
and will become potent factor in the
Northwestern business. Another de-
velopment may be expected at once, and
that is an extension of the Eastern Min
nesuta from Sioux Falls to Sioux City,
where it will connect with the Union
Pacific. The big men in the new road
will be j. J. Hill, Sir George Stephen,
Sir Donald A. Smith and Gen. Thomas,
who will form strong combination.
j. j. Hill was asked yesterday after
noon what he could say about the new
deal. He replied: IL have no informa-
ton to give beyond what has already
been published" An effort was made
to interview Mr.. Minot, but he sent
word that he was too busy to see any
one