Evening star., 1896-10-26
Samuel Spencer Defines the Best
Pol3J for Railroads.
rALKVlYHWksOUqHERN'SPR
An interesting Contribution to
Contemporary History.
AND SOUTHERN

for several years past; whether 1t Is to be
practically: though not nominally, con-
solidated with the Southern system;
whether the Louisville and Nashville COM
pany will soon acquire 1t, or whether 1t
is to be made the nucleus of another great
system Of railways which will penetrate
almost every southern state, and, through
friendly connections, reach Washington and
points further north, continue to be the
all-absorbing topics Of discussion in the
railroad and banking world.
That the new owners Of the Seaboard,
Messrs. Ryan and Thomas, are abundantly
able to hold the purchase and consolidate
it with other properties owned by them in
southern California and other states is no
longer subject of doubt, for no less
person that President Samuel Spencer of
the Southern said yesterday that MessIs.
Ryan and Thomas not only had immense
capital. but fine credit"
In the discussion of tho various points
which have arisen as the result or the
transfer of ownership Of the Seaboaril, 1T
has been developed that the Southern and
Louisville and Nashville companies are
operating the Central Of Georgia, through
an organization formed by the tVo COM
panies, under q joint lease, and this has
been subject of intense Interest through
out the south, as evidences have not been
lacking that the Louisville and Nashville
has been apparently trying to get the EN-
tire control of the Central for itself.
Samuel Spencer Interviewed.
The Southern's title to the use OF the
property was derived from Messrs. Ryan
and Thomas, and Mr.. Spencer thus ex-
planned how those gentlemen became SO
largely interested as they are In the Cen
trial. and also statement heretofore made
by him that the Southern has a beneficial
contingent interest in the Central.
Snhncnr- result
of two things: The Richmond Terminal re-
organization committee inherited the ma
jority block Of the old Central stock from
the Richmond Terminal Company, and in
addition to that, the Richmo Id Terminal
reorganization committee held a claim
against certain securities of the Central.
which were involved in an attachment suit
in New York. Then this resulted: The
capital stock of the new Central was de-
livered to the reorS Sanization committee OF
the Richmond Terminal to satisfy that
claim, and in exchange for the old stock.
The minority stockholders of the Cen
trail got income bonds, and the majority
stock got new common stock i'll exchange
Messrs. Ryan and Thomas received the
new stock of the Central part payment
for the property they had bought~-that is
the Central-and they delivered the prop
erty to the new Central of Georgia Rail
way Company, the stock of which was
transferred to the reorganzat tion commit
tee Of the old Richmond Terminal. That
explains how the.new stock passeu through
the hands of General Thomas ana MIR. F.
F. Ryan. They bought and reorganized
the Central for the security
The Southern Has an Interest.
''The new stock of the Central is lodged
today in the hands of the Richmond Ter
mirars Reorganization committee. The
Southern has an interest in it. If it is
legal for the Southern to hold it. it will
some day come to the Southern. If it is
stock will be sold and the Southern will
get the proceeds. Ii is entitled to the ben
efits accruing from the stock.
THAT the Southern has a beneficial in
terest in the stock is undenable, but the
Southern has never attempted to exercise
physical control of the Central The di-
rectors are nearly all Georgians. nearly all
of whom were selected by President Conner.
The two organizations are separate and
distinct and the Southern has never at
tempted to direct how the Centrars freight
should be rated, and has never interfered
with its policy in any way. If we held
all the stock in our hands and had the
legal right to use 1t we would exercise our
influence in the management Of the prop
erty but the Central would be operated for
the benefit of the Central, and it would be
wrong policy to do anything else.
The Men in Control.
"The rating power Of the Centrals stock
is in the hands of the old Terminals reor-
ganization committee. That committee con-
sists Of Mr.. Joline, Mr.. Sherman and Nj.
A. J. Thomas. Mr.. Joline is lawyer, a
member of the legal firm which is counsel
for the Central Trust Company Of New
York. Mr.. Sherman is vice president,
possibly the second vice president, of the
same company. Mr.. Thomas is business
man of New York, who has had good
deal to do with reorganizing railroad prop
critics, and he was at one time. believe,
the manager of road In the west some
where, and these gentlemen, with Mr.. Chas.
H. Coster of Mr.. ]. P. Morgans firm, re-
organized the Richmond Terminal
To illustrate how the Southern and Cen
trail might exchange business with each
other and be on the most harmonious bus
mess terms and yet be entirely Independent
as to ownership, Mr.. Spencer said: "At
Knoxville, Tenn, where the Southern owns
every road except the Marietta and North
Georgia, the Southern hauls out a sleeping
car to deliver to the Louisville and Nash
Vile for Louisville, although the Southern
has a sleeping car line OF Its own between
the two cities by way of Hartman.
Fair Competition the Best Policy.
'"It is the best policy for railroads to
maintain stable rates toward competitors
and give the others a show.
"All precedents show that whenever one
railroad tries to monopolize the business
some other line will cut rates and cause
decentralization. The East Tennessee lines
used to be open to the Seaboard Air Line,
and still are, because it is the wisest course
to pursue.
Referring again to the reorganization of
the RichmonH and iDanville, or Richmond
Terminal Company, Mr.. Spencer said:
s'rhis reorganization committee of the
Richmond Terminal Company includes two
members of the Central Trust Company,
which is trustee for certain bondholders
of the Central Railroad Company. The off,
GERS of that trtrustocompany would not SIT
quietly and sse meedictate a policy for the
Central whichs would be detrimental to the
interests of the bOndholders whom they
represent. Those gentlemen represent
three hundred or four hundred millions of
securities, aud they are managing their
securities forJthe benefit of all. They hold
the Central stock and vote it."
E1-secretsry whitney. Interest.
The latest information in reference to the
Seaboard is that e4eSecretary of the Navy
Whitney is largely interested in the prop
erty, and it IS, reported that Mr.. Whitney's
connection with the syndicate forms
large part Of the basis for the assertion
which mas been made that Ryan and
Thomas have practically unlimited capital,
as we'll as abundant credit.
It ia further reported that the resigna-
tion of President r. Curzon Hoffman is
question of but short time, and that Mr..
Thomas F. Ryan, who, in addition to being