The evening times. [volume] (Washington, D.C.) 1895-1902, 1901-10-18
The VAST RAILWAY TRUST.
uorgHH-HTH Interests to Combine
Three Systems.

i
Three Systems.
CHICAGO. oct IS-Au Iowa corpora
! ton capitalized AZ SIGO.G05. 90 and orSl0iz-
I ed for The purpose Of controlling railroad
properties TO be bonded at between $780,
o.'-a'J and 800 6'3. e.1-such is the plan iu
brief Of the AIorgau-EIU syndicate as dis
closed hy the Incorporation n Burlington.
Iowa, yesterday cf the Chicago. Burliug-
ton, and Quincy Railroad. If the Chicago
gossip is 10 De- relied on
Details of the plan. which is by far the
most stuprndous ey r achieved in the rail
way world. were learned here. and they
nave set the financial and railway worlds
talking None Of the Burlington officials
would consent TO give the slightest infor-
nation regarding the organization Of the
new company. but despite this facts came
to light which made IL certain that the
Iowa corporation is the proprietary com
pauy which is 20 take over all the sscuri-
ties OF the Burlington the Northern Pa
cifc. and Great Northern railroads.
This being the case. The Morgan cote
RE when the plan is perfected, viii be
able, by the ownership OF a bare MAORI
t. OF the 100000 capital stock of the
company, 20 control absolutely three big
railway systems aggreEaJing a mileage Of
over lN.auy miles, having a gross earning
capacity OF over Sl0500JJ0o yearly s,.-@
present capitalization Of Sf65. G99.030.
Furthermore. If il be seen fit TO do the
control Of these properties can be obtain
ed without the payment Of a single dol
lar Of the capital stock represented BY
the new company IN the opinion Of
hnanciers the scheme Is sufficiently bold
10 cause Napoleon in the game 10 pause
before taking the plunge. and the re-
suit viii be watched with the most in
tense interest
In general the plan is FOR the new or
parent company to take the stock Of the
iaIee companies involved and exchange II
Tor collateral trust bonds on a certain
basis. From all the Information obtain
able today the basis of exchange for the
northern Pacific preferred is ten coilat-
rral trust bonds for 500 each bearing 81
per cent interest for every ten shares Of
stock and in addition twenty-five shares
OF lI- capital stock or the new company.
The terms for the transfer Of the Great
Northern stock are said 90 be almost
double the amount offered for the North
ern Pacific The latter is paying 4 per
cent while the Great Northern. which is
all preferred stock pays per cent
II IS said that the Morgau-HUI people
nave determined to permit all stOckhOId-
erS- OF rather 10 urge all 10 accept the
terms Of the transfer Whether or not
this IS done makes little difference. as
the SN Indicate already controls a ajority
OF the STOCK or ali three companies The
transfer Of the Burlington stock has for
some time been IN progress. the terms be
lL.S two 4 Der cent bonds for every share
ot stock II the entire issue Of stock is
mus transformed the bond issue for this
company viii be S22D. 10000
The stock Of the three cOmpa niles prior
70 the Burlington deal was as follows:
burlington, common. $40. on. 0U0- North
erl Pacific preferred. SIS 90. 90. Mort hern
racine common, SHp.yi1uT1- Great North
err. preferred. SOS 90 U00; total y863. 90 0J8
To take care Of the Burlington stock
under the terms # transfer a bond issue
" E2ItI1urH viii be required provided an
ne stock is surrendered Taking the
Burlington stock out. there is So. 600 0l0
ielJ TO IS likely that 70 take care Of this
under The terms Of the transfer a bond
issue OF about - 3 90 600 VIII be required.
mn king the total bond issue Of the new
company ID the neighbOrhOOd OF S713.0Jg-
A question naturally arises REGARDING
the ability Of the proprietary company 20
pay The Interest on the bonds Under
thS old organization the fixed charges and
expenses including dividends on stock.
were as follows
northern. Tor 1910. 100000. Northern
FLcinc, Tor 1900. S5.000000 Total S53. 600
Under the new order Of things. assurn-
ing lh2T the required collateral trust
bond issue viii have TO be s70G 0g8 090 and
that the rate on the Northern Pacific and
Great northern bonds VIII be per cent.
the PROPRIETARY company viii have to
earn the following interest -Four per cent
on SZ-"HH'a1 Burlington bon Is 81 So UGJ-
q Der cent On SiNJ9n9.o00 Northern Pacific
ana Great Northern bonds. s.. 2Ol, 90; to
tai So. 10000
The net earnings Of the three Compa-
MES the Burlington for 1893 and the 9th
ers for 1900. after fixed charges were de-
Quoted We're Burlington. s.. 72S. COZ Great
Northern. SS.626.H99: Northern Pacific. Sc
$4,000. total 81 S37. 1q1
Accordingly, the net earnings viii have
10 increase over S6-~puoU above these fig
II.S lTl order 20 meet the interest charges
r. however. such deficit should occur
me SURPRISES Of the companies are SUI
L'ieEt % take care Of ir for several wears
anu IL is expected that economies OF one
ration and traffic VIII result su-Fcieur 10
increase the earning capacity Of the prop
critics materially.