The Worcester spy. [volume] (Worcester, Mass.) 1898-1904, 1899-07-30
STIRRED THEM UP.
'%@'sr,
How the Boston &
Albany Circular
Was Taken.
WHAT IT FAILS TO ANSWER.
A Principle That Is In
yolved in the
Question.
WHAT IT FAILS TO ANSWER.

Question.
The circular prepared by the Boston
& Albany directors for issuance to the
stockholders, as published this morn
ing, has naturally been the topic of
considerable comment in financial cir
Giles today. Conservative people who
have no special interest in the contro-
versy agree that the statement is a
clear and comprehensive presentation
Of the situation. as it is generally I'M
derstood. The circular really tells little
that has not heretofore been well I'M
derstood, but it does emphasize some
points so as to show that the position
taken by the directors is a strong one
For instance the demonstration of the
fact that the proposed lease on the ba-
sis of per cent, together with such in
come as may come from the $4,000, 900
of property held in reserve will give a
larger return to stockholders than
could be obtained from an exchange of
stock on the basis of $500 per share for
312 per cent bonds is a feature of the
argument that is bound to commend it.
self to every stakeholder who is looking
for the best results. OF course this
demonstration takes into account the
taxation of securities under the Massa-
chusetts law, to which those who have
favored an exchange of the stock for
bonds appear to have Seemingly paid
little attention.
Another point brought out in the cir
cular to the effect that the percentage
of business turned over by the New
York Central to the Boston & Albany
road is extremely large-reaching 81
per cent of the freight revenue and so
per cent of the tonnage-gives a COM
plete answer it would seem, to the ar
gument of the opposition that the Bos-
ton & Albany road is not so dependent
upon the New York Central for its rev.
enue as has been claimed. This fact
alone furnishes in itself an excellent
reason for a careful consideration of
the question of leasing the property to
its natural ally, the New York Central.
And then, too, there is the sugges-
ton of a possible and very probable
falling off in business in coming years,
brought about by growing competition.
Much as Boston & Albany stockholders
may pride themselves on the excellent
condition OF their property and it's
large earning capacity the recent
growth of competition, as shown by the
figures from the annual reports of the
road, certainly indicates that this de-
crease is liable to go on in an increasing
degree And still further the intima-
ton that the directors, in deciding upon
the lease, while they have primarily
sought to further the interests Of the
stockholders, have also had in mind the
"a. W. M af
the commercial interests of Boston, is
good point. 1t is one, too, that is
bound to win popular favor and to call
public attention to the advantages of
the proposed agreement even if the
stockholders themselves shall fail to
ratify the lease as drawn.
The circular fails to answer the
charges that the lease was agreed to,
by reason of threats, and that it was
Sprung" upon the board of directors,
The fact that of IL members of the
board of directors all but one of those
qualified to act have approved the
lease, is, it is pointed out, an excellent
indication that there was no snap
procedure adopted in reaching the ar
rangement. AS these gentlemen are all
men of high standing and excellent
business Internationally with those
representing the large class who have
would hardly seem necessary for the
board to answer the ungracious claim
of an attempt to adopt unfair methods.
OF course, the answer of the directors
to the opponents was hardly expected
to suit all of the latter; nor has it done
so. Looking at the matter from an I'M
prejudiced standpoint, however it is
difficult, as many investors view it, to
see how under the existing con-
ditions and when it is taken into
account that the New York Cen
trail people are in position to
give what is practically an absolute
guarantee, the opponents can accom-
plish anything better than what the
directors have accomplished The sit
uation, as it stands at present, is such
that if the lease is not ratified by the
stockholders, the benefit that is assured
under the agreement may be lost, and
it is practically certain, so those well
Informed assert, that no better terms
can be obtained.
With the possibility of the New York
Central turning a very large proper
ton Of the e. per cent of the roads
freight revenue that it now gives to the
Boston and Albany, on to other lines,
and with competition from the trolley
system steadily growing, it is a
question in the minds of conservative
men in financial circles whether it
would not be an extremely foolish pol
icy, even If, for the time being. the re-
turn seems smaller than it ought to be,
for the stockholders to reject the pres
ent proposition. Beyond this is the
possibility. also, as has heretofore been
suggested in this column--and it is a
possibility that may become a prob
ability-that the state may interfere.
and by exercising its legal right to
purchase the road, bring about Just
that which is now proposed through a
process that may result ultimately in
smaller net return than that now Of
fered to the stockholders.
Public interests and the commercial
interests of Boston are not to be AL
lowed to suffer because of the desires
of stockholders for larger investment
returns. This is principle involved
in this question, and it is bound to be
taken into consideration before the ex-
listing controversy is settled Put into
simple proposition it is purely a cues
ton as to whether stockholders will
take what, in the minds of many peo-
pie, appears to be reasonable offer. or
by contesting, take liability of get
ting a less favorable offer. AS many
look at 1t, 1t would seem to be the part
Of wisdom and good business Judgment
to settle the existing differences n
possible, and to work in harmony for
the accomplishment of that which will
be for the good of all and for the great
benefit of Boston's business and com
mercial interests.
TREASURY STATEMENT.
Washington, July 29.-Today's state