The morning news. [volume] (Savannah, Ga.) 1887-1900, 1898-08-31
TO SELL THEIR BONDS.
Baltimore Syndicate to Take South Bound
Securities.

Baltimore Syndicate to Take South Bound
Securities.
Negotiations which have been under way
for some time, with a syndicate in Balti-
more, are about completed, and the out
look is that within the next two or three
days the bonds of the South Bound Rail-
road, held in escrow by the Mercantile
Trust Company of that city, to secure a
loan made to the Savannah Construction
Company, will be sold at about Is cents
on the dollar.
There are, ii Is understood, $1,550,O00 of
these bonds held by the trust company,
which at 75 would yield $1,162, 500 for the
construction company. The debt for which
the bonds are held in trust is about $780,
0OO When this and some expenses are
paid there win be enough left to pay out
the stock of the Savannah Construction
Company at about par The stockholders
OF that company win have the satisfac-
ton of knowing that they gave Savannah
one of it's finest trade feeders, a railroad
that gave important connections with the
North, and have managed their affairs so
successfully as TO wind up BUSINESS with
their stock worth 100 cents on the dollar,
a record that probably has few equals.
The Savannah Construction Company, as
is well known, built the South Bound Rail-
road. The latter company was chartered
to build a railroad from Savannah to Co
lumbia, S. c. The need for such a road
had been long felt by business men and
the general public, and the outlook for
thriving traffic for it was considered as
good. The construction company was or
ganized with S741, 600 capital stock, paid in,
as called for. the money being used in the
construction of the South Bound. This
amount was not sufficient to complete and
equip the $40 miles of railroad, and $780,
600 of per cent bonds were sold at 621a,
and the proceeds applied to this purpose.
Under its arrangement with the South
Bound Railroad for constructing that road,
the Savannah Construction Company was
to receive stock on the road 10 the extent
of, it is understood, S12, 900 a mile, and also
bonds to the extent of about $3.50 900.
The original capital of the construction
company, and the proceeds of the bond
sale referred TO not being ample to meet
its requirements recourse was had to a
loan. This was a critical time for the con-
struction company Six of its stockhold-
ers, wealthy and influential Savannahians
came to the rescue and on their indorse-
ment and the hypothecation of the remain
ing bonds the sum of $750,000 was borrow
ed, and applied 10 the liabilities contracted
by the building and equipping of the road.
These six stockholders derived no direct
advantage from placing their credit to the
benefit of the company.
In the meantime, the South Bound had
been passed under the control of the Flor
Ida Central and Peninsular Railroad Com
pany, which was seeking an outlet to the
North. AS will be remembered, it built
up from Jacksonville to Savannah to join
its Florida system to the South Bound
Railroad, and thus secured connections
with the Southern at Columbia and the
Atlantic Coast Line at Denmark This
was the making of the Florida Central and
Peninsular. In securing control of the
South Bound it paid $200,000 to the con-
struction company for all of the stock is
sued by that railroad assumed some liza
bilities, and guaranteed the bonds of the
railroad, which were changed a this time
from a per cent. to a per cent The
bonds, as has been stated, were the prop
erty of the Savannah Construction Com
pany, except the 100000 of them sold,
which had practically all also remained
in the hands of stockholders of the con
struction company.
OF the $750,000 borrowed when the bonds
were hypothecated, about $S5O,OOO has been
repaid, interest from the bonds having
been applied to this purpose This leaves
the Construction Company. when the pres
ent deat goes through, in position to close
up It's accounts, and settle for its stock
as stated, at par. This is considered a
highly creditable showing and one that
reflects we'll on the ability of those who
have been in charge of it's affairs MIR
H. M. Conner was the first president, and
was succeeded by B. A. Denmark, Esq,
both having the assistance of strong
boards of directors.
An of the directors have not been in IA
vor of accepting the proposition of the
Baltimore syndicate, believing that by
holding on year or two longer better
prices may be obtained for the bonds, which
are regarded as an excellent security, and
likely to improve in value The great ma
jouty, however. seem to have favored COM
ing to terms. disposing of them, and cics4
ing up the affairs of the Construction Com
pany. Mr.. Herman Myers is understood
to be in Baltimore now looking after mat
tiers connected with the sale of the bonds