Evening star. [volume] (Washington, D.C.) 1854-1972, 1896-10-14
THE SEABOARD DEAL
An Inquiry Into the Transaction by State
Authorities,
Harmony, If Not Union, With the
Southern sy"t1" i. Predicted
About MN St. John.

The true ,nwardnesAsa 81 the aea, by which
the seaboard Air Eins passed from the
| control of those who, owned 1t month ago
! to that of Mr.. Thomas II. Ryan and Gen.
eral Thomas of New York, which was COM
pleted just previous TO the annual meeting
| of the stockholders at Portsmouth, Va,
will soon be known to the public generally,
as steps to ascertain this have been taken
| by the attorney general Of South Carolina.
! That official has sent a. short letter 10
| each gentleman named, informing them
| that as they negotiated the transfer of the
stock of the Seaboard he desires them
| to prove to the satisfaction Of the special
| railroad board of South Carolina, which
| consists of the governor the attorney gen.
| eral and the state railroad commissioners,
| that in the transfer Messrs. Ryan and
| Thomas had no connection or understand
| ing with the Southern Railway Company.
The new constitution Of South Carolina
prohibits the sale of any railroad line to a
parallel or competing line, and the special
board means, 1t is said. to ascertain wheth-
er the recent purchase Of the Seaboard by
Messrs. Ryan and Thomas was not a vio-
| lation of that instrument.
| Confidence In the Deal.
| A prominent banker in Baltimore. writing
| to a friend in Washington in reference to
| the deal above referred to, says: Although
| there appears to be doubt in the minds
| of some people as to the sale Of controll-
| ing interest in the Seaboard system l am
| informed by one whose Information can
| be depended upon as authentic that the
| owners of the 4.OOO shares of pooled stock
| have signed contract to deliver the same
| to the purchasers at a fixed price, and that
| the only condition is that the property
| shall upon examination prove to be In the
| condition as set forth by the management.
| rha An pfo1 OF n
| management state that during the months
| of August and September the Seaboard
| earned 10000 more than during the pre-
| vious two months, and these and other
| statements will have to be borne out by an
| examination of the books, which will also
| show just how the property stands.
| 1.-The movement inaugurated by Gen.
John Gill; president Of the Mercantile Trust
| Company, for the purchase of Seaboard
| stock at par Is still in force, and will not
| be withdrawn for various reasons. and 1t is
| believed that the transfer Of the controlling
| interest as secured by the Ryan syndicate.
| month.
This 1000 shares, together with the
| stock controlled by Gen. Gill, carries with
| it the control, and 1t may be asserted that
| the management Of the company will
change hands as contemplated.
| "Whether it's cause has been just or not
! the Seaboard has been responsible for a
series of freight and passenger rate wars,
| and the holders of securities depending
| upon the prospects of properties in the sys-
| tenn will welcome with much pleasure a
| change Of policy which will prevent such
rate cutting in the future.
The Seaboard has been the firebran nd
! which has disturbed the whole Southern
Freight Association. and the frequent rate
wars fnaugurated by this company have
| threatened to disorganize the entire rail-
| way system of the south. to destroy values
and to put in jeopardy the securities of
| many southern roads. do not pretend to
| judge as to the provocation which the Sea-
| board system may have received, but I
certainly think the placing of an opposition
steamboat line on Chesapeake bay by the
Southern Railway Company did not justify
! the cutting OF rates and placing the whole
system of southern roads in such a position
| as to imperil the interests of the holders of
| millions OF dollars of securities
Harmony IL Not Union.
neither or not the management of the
Southern Railway Company Is interested
III the Seaboard purchase the property. if
the deal Is carried cut will. it is believed,
b, IN harmony with the former company.
| Our home people are largely interested in
Southern as well as Seaboard securities,
and Will welcome policy which will per-
NIT both companies to take advantage of
| the large traffic now offering.
| THE railroads of the south are doing an
especially good business. and with fair
| rates can make good returns to the owners
o. the several properties. 1 hope that the
rate-cutting and throat-cutting war is per
mar emily closed
| Under ST. Johns Management.
| In an interview with a Star reporter, a
prominent railroad man said: When Mr.
St. John few years ago left the Chicago
| and Rock Island road to take charge of the
Seaboard Air Line the step was regarded
| by Mr.. ST. Johns friends as unwise, for
| the reason that the Seaboard was practi-
cally an unheard of line. and could well be
| described as two streaks of rust running
| through a deSolate country. 1t was said
| that the lire had not been mismanaged
| That was probably true, and, indeed the
fact is that it had never been managed at
| all. 1t had been operated about in the
| same way as were most of the southern
| reads until within the past couple of years.
| which was to let them go about as they
pleased.
| well. Mr.. St John was asked to take
| Charge of the Seaboard. He was informed
| that the stockholders were anxious that
! the road should appear on the map with
| other railroads, and that they wanted it
! pushed along so that it would eventually
| get on dividend-paying basis.
''St. John had been in railroad wars be-
! fore, and, being of a naturally aggressive
nature. he Instituted measures almost as
soon as he took charge that made the road
| talked about among business people. Such
policy was absolutely necessary, in the
| judgment of Mr.. ST. John, and the other
! obstacles the former would have in sue
| cessfully operating the road. He had for
| his most active competitor the Southern
| Railway Company, and at last the South
| ern Railway and Steamship Association,
| after vainly trying to get the Seaboard to
| join their ranks. boycotted the Seaboard
| and a ruinous war of rates followed. The
| boycott was, however, overturned by the
courts.
by Mr.. st. Johns management of the
| system the Seaboards stock advanced from
| $40 to over 500 share
He Will BE Continued.
THE majority of the stock of the road
has. as above stated, changed hands, but
the change will not, 1t is believed, affect
Mr.. st. john Apart from the fact that
he has contract with the Seaboard, which
yet has several years to run, he is regard.
ed very highly by the new owners, one
of whom said, when questioned on the sub
| ject: -
There is no reason under the sun why
Mr.. ST. John shoulG not be continued in
Office. Both Mr.. Ryan and myself recog.
nize Mr.. st. Johns ability. He has CON
Quoted very stubborn fight and why
cannot he pursue policy of peace as sue
| full 49,