The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1897-08-23
INDIANA GAS INTERESTS
EXPERIENCES OF CAPITALISTS WHO
HAVE CoRNERED THE FIELD.
Securities Subjected to Bear Influ-
ing a Great Deal OF Money.

ital- The particular storm centers at pres
ent are Indianapolis and Peru, but the plan
of battle is comprehensive and involves all
that part OF Indiana where natural gas Is
sold for private consumption When nat
ural gas was first discovered in Indiana
the Standard Oil crowd and the coterie
of capitalists known as the Brice syndi-
cate were prominent in its development.
But it was too uncertain a matter for
heavy investments, and the great bulk or the
work of developing and piping the fluid to
the cities in the vicinity of the field fell
upon those who had undertaken to do the
work with popular subscriptions The bust
ness proved enormously profitable, and II
built up a number of considerable fortunes.
In 1890 E. c. Benedict and the crowd of
men variously known as the Benedict
crowd" the "Jerzmanowski syndicate" and
the Central Trust clique" turned their
attention to natural gas. They had been
in artificial gas for years and their op-
erations in New York Consolidated Gas,
Chicago Gas Trust and Welsbach light
and other light corporations, were We'll
known to the financial world. Like all
conservative capitalists, they were afraid
of natural gas, but thought it we'll worth
while to try the experiment in Indianapolis,
where a. fuel gas plant would probably be
valuable, even after the exhaustion Of nat
ural gas. Then they had theory that
single corporation conducting the artificial
and natural gas plants of city could prac-
tice certain economies and make money.
Their enemies now intimate that one Of
these economies is to run natural gas
through the retorts and mix it with artih-
cial gas at tie proportion of 70 per cent.
natural and 80 per cent. artificial, and sell
the combination at the high price of arti-
fetal gas. If this were done it would be
enormously profitable, for natural gas sells
at 10 cents a thousand and artificial at
$125, but no evidence has ever been adduced
that it was done.
In Indianapolis the artiflGal-gas plant and
one of the two natural-gas plants were
owned by practically the same people An
agent from New York purchased the two
for 100000 1t was said at the time that
the purchasers were the Jerzmanowski SYM
dictate, but Baron Jerzmanowsld soon re-
tired to the background and Z. +. Dleterlch
came to the front as the head of the SYM
dictate. The thing was an experiment ana
Jerzmanowsh had grown too rich to have
his name connected with failure. Whue
a few financiers have known that Benedict,
the FergusOns and others OF the Benedlct
crowd were behind the DEAL the general
public has hnOWn nobody else in 1t than the
Dieterch syndicate. When the deal was nrst
magnitude, but was gas expert VINO mao mao
long been in the employ OF the Benedlct
people They have done well by him during
the past ten years and he has acquired con-
siderable capital. The Indianapolis expert
ment worked we'll. After paying $2'00900
for the plant, they bonded it for $2,6o0OUO
and let the bonds go to the broker at ~
with a bonus Of $500 stock with every thou
sand-dollar bond. 1t was stocked at $Z,OCQ,-
this bonus still left the promoters enough
stock to control The bonds went to tue
customers at 80 Tney are n enrt 8gr3SmntIT
met and the stock has paid DIVIDEND OF II
per cent. right along. The bonds were IS
sued in 1880 and all toated by 1892 and the
syndicate was ready to widen its operations
in the Indiana field.
ACQUIRING OTHER PLANTS.
Within the next three years the artificial
and natural gas plants In nearly all the
larger towns in the northern portion OF the
State we're bought up and the same policy
shown at Indianapolis was pursued. They
paid very liberal prices for the properties
but they loaded them still more literally
with securities and have succeeded in get
ting rid of the bonds right along. Briee
and his associates were heavily interested
in most Of these properties and thought
they were unloading them at tremendous
figures, but when they saw with what ease
the new purchasers foated their Donds,
they got it into their heads that they had
found out what the move meant and after
allowing them to make half their purchases
| squeezed them hard on the new properties
| that were necessary to Complete the
However, the Benedict people went .n1er-
| riy on. The plants at Lebanon Frankfort
| and Charlottesville, both artificial ana lat
! ural, were taken in and reorganized as
| the Indiana Gas Company with H,gg0 900
| bonds and 81, eco 600 stock In bonding these
new properties they went Il little further
than they cid in Indianapolis and gave
| -. ,r.~r9t, nn l.n
! price. Next the plants at ooganSport, Pel9
! and Decatur were taken in and organized
as the Logansport aad Wabash Valley Gas
| Company, with bonds of $,75O, goo and stock
| of $1,750, 600. Brice permitted them 10 BUY
up Feru, Wabash and DECATUR 5efo1e his
| agent would talk about Logansport and
! then, after they mad issued their notices
| of the proposed reorganization, the price
Of the Logansport pant jInAped at the rate
| of $40 900 a day while the negotiations were
| III progress. He might not have been so
mean about this If the new people had not
| first come in there and filed the local
newspapers with talk about their intention
of putting up new plant
THE LAFAYETTE PLANT.
Then they advanced upon Lafayette Here
the stock in the plants widely distrib
uted, and it cost them about 100000 to
gather it in. The concern was fioated, how
ever, with 100000 bonds and S1000,0 900 stock.
Then came the last and largest purchase
outside of Indianapolis. The Fort Wayne
and Bluffton plants We're purchased and
consolidated, with 81, 500, 900 bonds and $780,
600 stock. Some of these properties have
paid better than others, but the interest
on all the bonds has been promptly met
and the stock has yielded from s to IL per
cent Upon these properties, which have
cost the syndicate about S5,500000 in cash,
they have issued SSs00,0O bonds and $780,
900 stock. They have tloated the bonds, get
ting so for them, and have given along with
them some s., 900, 900 stock in bonuses, clean
/ s,rr fa4 hon ~ IN aGh
and still retaining over SoVD,UO0 of the
stock enough to control the properties
All this money making has excited some
envy and during the last year a strong
combination has been effected to bear these
securities. Public sentiment for cheaper
gas has had much to do with this bear in
fuence. Both political parties have taken
and the Council passed an ordinance reduc-
ing the price of gas from $l.20 a thousand
to rs cents. The company mas resisted this
in the federal courts and obtained tenn
porary injunction against the enforcement
of the ordinance by giving bono TO insure
rebates If the case goes against them. In
Peru the franchise is about to expire, ana
they are holding public meetings to impress
the Council that gas must be cheaper. At
the same time the agitation is gong on IN
all the other cities and the bear campaign
is active all along the line. 1t is pretty
fight, and it seems inevitable that the people
must finally obtain cheaper gas.
-a-D-$~
Buffalo BiIPs Military Exhibit.
Buffalo Bills wild West still has the IA
nous military exhibit which the four great
military nations of the world contributed
/ ct ia "a