Evening star. [volume] (Washington, D.C.) 1854-1972, 1895-07-30
A BIG DE AL ON
How the w. & G.. r. R. Go. Will
Accomplish Its End.
THE ROCK CREEK WILL BUY IT
A Stupendous Proposition Now
Under Consideration.
CONDITIONS OF THE CASE


There will be meeting Of the stock
holders Of the Washington and Georgetown
Railroad Company tomorrow at 10 o'clock
am. for the purpose of voting upon the
issue of 5000 wcrth of convertible bonds,
bearing interest at per cent per annum
and running thirty years. These bonds will
| be in the nature of a third mortgage upon
the road, and will advance the bonded in
| debtedness of the corporation to $4,O00,0oQ,
There are at present two classes of Wash
ington and Georgetown railroad bonds, the
| fret being convertible per cents, redeem
| able from 1899 to 1929. There are 100000
| worth of these. The second class are also
| 6 per cent convertible bonds. running from
| 1903 to 1913, the issue amounting to $500 o0o.
| The bends whose issue will be voted to-
| morrow will be sold.it is now believed, to the
stockholders of the company at par, al
| though the question of selling them at auc-
| ton to the highest bidder has been the SUBJ
| ject of serious discussion. The value of this
| policy to the stockholders is apparent when
| the amount bid in the stock exchange yes
| terday for both the former issues of bonds
| was 135. The stock of the Washington and
| Georgetown Railroad Company consists of
| $4,000 shares of a par value of $50 each,
and for these shares 275 was bid yesterday.
| During the past few weeks many and per-
| sistent rumors have been af1oat that the
| Washington and Georgetown Company in
tended to secure the control of the Rock
Creek Railroad Company for the purpose Of
extending its system along the rapidly
| growing lines of travel in the northwestern
| suburbs
Deniais That Were Technical.
The officials of both roads denied that
any such intention was under considera-
1T sI,<,-
| ly correct, but their declarations did not
have the effect of settling the rumors. The
Star on Thursday last called attention to
| bill which was passed at the last session
of Congress, which authorized the Rock
| Creek Railroad Company to lease, operate
| or purchase any connecting or intersect-
ing lines, and empowering it to increase its
| capital stock to the extent of the actual
consideration paid for such other railroad
or roads The bill further provided that
one fare should be charged for single
continuous ride in the District over all lines
| thus connected.
|. The Star stated that 1t was believed that
| under the provisions of this bill a company
| could be formed, or rather transformed,
from the Rock Creek Railway Company.
with two or three other companies added,
| and that the issue of stock. which the new
company is authorized to make, could be
given in lieu of the stock and bonds issued
by the existing companies.
Way to Convert the Bonds.
All the bonds issued so far by the Wash
ington and Georgetown Railroad Company.
as well as those to be issued tomorrow. are
convertible. 1t has been well known in
financial circles that the capitalists of the
Washington and Georgetown Company
have for a long time desired to find some
| means by which their bonds could be con-
verted into stock.
The bonds are cimost entirely owned by
tie stockholders, each issue was sold 10
them at par. Under the provisions of the
act mentioned, which passed Congress last
winter, clothing The Rock Creek Company
with authority as Eoted above, the WASH
ington and Georgetown people believe that
they have found way to rot only take
advantage of the convertible feature Of
their bonds, but to gain access to territory
rapidly growing in population and destined
| to become one day the home of a well-to-
do and numerous community. Therefore,
there is plan under consideration by the
leading capitalists interested in the Wash
ington and Georgetown road, which is as
follows:
The Proposition Under Consideration.
While existing law would prevent the
Washington and Georgetown Company as
| a corporation from purchasing the Rock
Creek Company, there is nothing on the
statutes to keep the Rock Creek Company
from selling out to individuals. 1t is said
| to be the purpose, therefore. of large indi-
vidual stockholders of the Washington and
Georgetown road to buy the Rock Creek
Company, and Immediately thereafter pur-
chase the Washington and Georgetown
Railroad Company, under the provisions of
| the law mentioned above. The issue Of
S, 600 600 worth Of stock by the Rock Creek
Company would, 1t is thought, be sufli-
cient to purchase the bonds and shares Of
the city company.
There would merely he a transfer Of The
| latter securities by their holders for an
equivalent amount of stock in the new COM
pany. 1t is probable that when these ar
rangements are completed a new corpora
tion,- under the name of The Capital Trac-
ton Company will be organized, with a
| capital of $10,0O0000 In this rounGabcu
, but nevertheles perfectly legal way il is
believed by those interested that the Wash
, ington and Georgetown Company can
achieve its long-dSsired aim to convert its
: bonds into more valuable stock. and at the
1 same time secure entrance to the rapidly
growing region of the northwest. 1t now
: costs about $4,000 year to operate the
e Rock Creek railway. but this expense would
t not be felt py the vast corporsti ton which is
e now under serious consideration.
t | 1t is improbable that the meeting tomorrow
: | will formally consider the proposition here
in outlined, but 1t is generally believed in
financial circles that another meeting VIII
be called, probably in October, when the
| majority of the heavily interested capital
lists in the movement have returned TO the
: city when the matter will be taken up for
Y | final action.