The Somerset herald. [volume] (Somerset, Pa.) 1870-1936, 1892-02-17
The Reading Deal.
H. Holds a Threat OverEgsry Con-
sumer OF Coal.

II HOLDS q i 1redl OFcFEEGFy GQE-
sumner OF Coal.
Henry Clews & Co. the great bankers Of
New York, sent out special circular in re-
card to tbs Reading deal of the early part of |
the week, which contains these paragraphs
On Wednesday, the fact was authoritative
IN acknowledged that an important deal had |
been already c0nsummsted as between the |
Reading. the Central Of New Jersey, and the |
Lshigh Valley Railroad Companies, calcu- |
lated to have important future bearings up
on these companies, if not upon. the entire
production and distribution Of anthracite.
The purpose of the arrangement is 10
place the Lehigh Valley and the Central Of
New Jersey under the direct control OF the
Reading. not ihro@gh lease, which would
be illegal in the States through which the
roads run. but through trust arrangement
which il is assumed viii hold good in law.
The plan is very much the same as that un-
der which the Chicago Gas Company con-
trolls the several corporations OF which it is
composed. A msjority CT the stock OF Le-
High Valley and Jersey Central is placed in
escro IN the hands OF Trustee and in be-
halfof Reading, and the latter Company
places in the custody Of said Trustee GER
tain amount Of interest-5earing secu rites,
to insure the fulfllment of the engagements
undertaken by Reading toward the other two
Companies. Beading guarantees dividends
upon the stock of the I.ehigh Valley al the
rate Of ; per cent. until July l. 1892 AT 6
per cent. from that date until July /, 1898,
and at : per cent from and after that date
After July ,, 1874, : per cent. is guaranteed,
and any surplus above that Is to be divided
equally between Reading and Lehigh Valley
until 10 per cent. is paid to the latter, when
the Reading will take all further surplus.
Reading guarantees per cent. henesforth
on New Jersey Central stock, and divides
equally any surplus above that amount with
Ii company The Directors of the
two minor roads will be given full represen-
ta,ion in the directorate Of Reading.
This combination will cover fully sixty
per cent. ofthe present production of an
thracite coal. To guard against the posi-
bility of this msjority in production being at
some future time lost, il Is uade-stood that
the friends Of this transaction have procured
a controlling interest in the Delaware, Lack
aEanna 4 Western, so as 10 secure the more
certainly the harmonious cooperation Of
that Company for the objects contemplated
in the amalgamation. The harmonious CO
operation Of these four companies viii con-
trol seventy-fye per cent. Of The entire out
nut OF anthracite This arrangement covers
a shave and bond capital aggregating 1852,
$500, and must, therefore, be ranked
among the most important railroad consoli-
dations accomplished in our railroad histo-
~.
The proiessed object Of this great deal
/, Is to produce better harmony among the
producers and carriers of anthracite, to
/ economic in the methods of its distribution
: and to Obtain better control over its prices
The means sseIn to be construed IS a shorl
and easy way TO the end Probably, there
Is little doubt that the first results will be
= satisfactory-even highly SOTO the owner
Of the properties. Bat it IS not to be over
: looked that the consolidation IS an expert
!. meut. and that its ouiwoTkings mus; en-
:. ! counter problems new to our industrial ex
perience. and the solution of which eannO
= now be forzeen, In its principle, though
:, not in its form, the company IS virtually th'
same as that upon which our great trusts
have been formed, and, with one or two ex
ceptions. our experience OF those Organizs
tons has not bsen such as 10 encourage san
guine hopes Of thsir parmsreney. Within
p, the past month two of them have broker
I'D. partly from disagreement among thei
] members, but principally because they hav
failed to insure the control for which the
were organized. The public will regard thi
. new amalgamaiion of interests as long ste
> in the direction OF a monopoly of the an
IL thraciie trade, and certainly not withou
some primG facia show OF reason. Ho'
= that ordinarily dangerous power viii, !
this case. be used remains 10 De seen.
= can hardly fail 10 he viewed with distrui
u by all classes of the community for
holds threat over every consumer Of fu'
- from the great transportation and manu
= featuring corporations to the humblest col
= taee. Moreover, the spread of these grea
concentrations of capital is steadily buildin
up hostile public opinion, which ma
= some day assert itselfin legislation to a
= Overwhelming effect and the courts are a.
n cumulating an imposing mass of decision
= against eombinstions whose effect is to in
r pair the free working Ct the law Of competi
ton. There is no saying what may be th
= ultimate outcome Of these sslEprotective ter
denotes Of public opinion and, for that rel
son, it is impossible to tell how far the pc
maneEt value OF the securities concerned il
this amalgamation Day be affected by th
significant achievement.