The times., 1901-06-01

financial affairs of the company were not
In such shape as to make this feasible.
The Washington Traction Company has
$40. .OO0. 900 of AZ per cent collateral bonds,
secured by its holdings of securities in the
various subsidiary concerns. OF this total
S1S 600 was at first issued, the remain
ing s7,OO0O0O being held in the treasury of
the company to provide for the payment
of the first mortgage bonds when they
become due. Later 100000 more Of the
collateral bonds were issued, so that there
now remains of the total but S6,60,O00 in
the treasury. This amount of bonds is
considerably less than sufficient to pro
vide for the taking up of the underlying
mortgages If the floating debt is added
to the total of these first mortgages the
problem to be met in this regard is still
more difficult The first mortgage bonds
are 1890. COO about. The floating debt is
probably at least sufficient to make
total of 100000 900. The S6,6010O) Wash
ington Traction bonds In the treasury at
par would be only two-thirds Of this
amount. At their present market value
around Sc. they are worth only s4,290.Go0
or less than half the debt of the company
ahead of the bonds
In addition to the issue of s2o.O0O,OOO Of
bonds the Washington Traction Company
issued Sl2, ,O00900 Of capital stock. This
was given to bondholders as a bonus
largely, and a portion is also supposed to
have been given TO the people that pro-
moted the enterprise part of the pay
for their services. This stock was prac-
tically all issued. 1t had market value
of about is at first but gradually de-
clined in price until at one time it could
be bought for 81 a share. Recently it has
been more in demand and it is under
stood that considerable blocks have
changed hands at 8 and 4.
The comment of many careful people at
the beginning was that the company was
much overcapitalized. IT was pointed out
that even at the high prices paid for the
securities of the underlying companies
their total did not equal anything like the
S13,GO00 600 of collateral bonds issued on
them. The Sl2, ,09OooO of capital =tvck in
addition was concededly all water. and
could only be of any value if the com
pany should prove a big success.
The bonds. when issued. were not large
y subscribed for by the general public. The
syndicate which took up the plan from its
promoters is understood to have beea
forced to keep a large portion of the
issue itself. One statement that has been
made is that not 81. 100000 of the entire
s15. 100000 has been taken by the public.
The syndicate was composed of num-
Der of large financial interests, mostly
of New York. This syndicate is sup
posed TO have advanced the large sums
represented by the floating debt Of the
concern. It's venture therefore, has not
been a very profitable one up TO the
present time. Just how bad it has been,
however, depends largely on what price
it paid for the bonds at the beginning.
1t has been said bv some that the bonds
cost it considerably less than par.
The bonds of the company sold around
par for short time after they were is
sued. Then they began to decline rapidly
in price. and at one time several months
ago were below 60 Since then there has
been an advance, with considerable fiuc-
tuations The recent price has been be-
tween 65 and 20.
One of the stories in F Street during
the past few days is that the management
of the company has changed hands re-
Gently. This r71mor has it that a new
coterie has become possessed either Of a
controlling interest in the capital stock
of the company or of the bonds, or of
both For the past month or more there
have been rumcrs of a large demand for
the stock. and as has been said, the price
has advanced under this demand. from
near nothing to s. and 81 a share Ii has
been considered improbable. however,
that any interest could secure the stock
without the consent of the bondmders,
as both issues were supposed to be in the
same hands to large extent.
There is much surmise among business
and financial men, both here and in other
Eastern cities, where the bonds are held, !
as to the probable future of the Wash |
ington Traction Company. Despite the 1
failure of the company to meet its obliga- /
tons up to this time there is DISPOSE !
tlon st present to consider its outlook not /!
gloomy, especially if a scaling of the bond
issue can be made without foreclosure
and a receivership. The suggestion is
made that the worst of the difficulties of
the concern are in the past apparently,
If the question of earnings and expendi-
lures only is considered. The expendi-
tuees for betterments all over the system
have been immense and at present its
condition is generally considered
by railway experts to be excellent. But
few further expenditures are needed for
additional cars and other equipment On
the other hand the earnings have been
Increasing steadily, as has been said
IT Is thought that the present diff
culties of the company may result in a
c1rtailing Of transfer privileges to the
public, and in other efforts to make its
revenues larger Nothing is known as to
the possibility of new management for |
the company. If. as Is hinted in some |
quarters. the control of the company has !
passed into new hands a general reor-
ganizftion of the directorate and officers |
of tl3e concern seems not unlikely.
NO TISITS IN NEW ENGLAND.
The President Muy Abandon His |