Evening star. [volume] (Washington, D.C.) 1854-1972, 1901-03-14
Pennsylvania Buys Heavy Blocks of
the Stock.
BOTH COMMON And PREFERRED
There VIII Be Few Changes in
Present Management.
MIR. SALOMON TO RETIRE

| Special From STAFF Correspondent.
| NEW YORK, March 14.-The Pennsyl-
vania Railway Company has secured con-
! troll of the Baltimore and Ohio and in
| future the two roads will be operated in
| entire harmony at all points. There is to
| be no consolidation, and each will have its
own president and other general officers
! What effect, if any, the deal will have on
| the proposed improvements of the two lines
| in Washington cannot as yet be ascertain
| ed, but the impression among those best
| posted is that the plans heretofore agreed
! upon will be adhered to-
While the Pennsylvania will in future
| control the policy of the Baltimore and
Ohio it has not actually bought a majority
| OF the stock 1t has, however secured
more than 100000 shares, and it has also
taken nearly the entire issue of convert
| 1ble bonds which were issued by the Bal
t1more and Ohio short time since. The
position of the Pennsylvania in Baltimore
! and Ohio affairs will, it is stated here,
henceforth be precisely similar to that en-
joyed by the former in Northern Central,
Baltimore and Potomac Chesapeake and
Ohio and other roads with which it is
largely identified.
Mr.. Solomon to Retire.
SHaii w ulldm calOmOn OF the Bal
timore and Ohio railway is to retire from
that position and from active participa-
tion in the management of the company.
The Baltimore and Ohio voting trust is to
| be abolished, or entirely reconstructed in
| the interests Of the Pennsylvania railroad,
which now controls the Baltimore and
Ohio. Additional Pennsylvania officers will
| be elected to the Baltimore and Ohio board
the min
themselves make up their minds just what
representation they want. At present only
two officers, Vice Presidents 8. NJ Provost
ana j. +. Green, are on the Baltimore and
OHIO board out of eleven directors elected
by the shareholders. They will probably
nave majority of the board. The Penn
sylvania now controls about $40, 600 600 par
value of Baltimore and Ohio stock about
equally divided between preferred and
common stock. The outstanding capital of
the Baltimore and Ohio railroad is $45. .OO0,-
COO common and s60000, 600 preferred, so
that the amount controlled by the Penn
sylvania, though not an absolute majority,
gives 1t a dominating voice in the Balti-
more and Ohio affairs.
This controlling voice has only been Sc
cured since the recent issue of convertible
debenture bonds by the Baltimore and
Ohio. The Pennsylvania as a stockholder
In the company subscribed for its full al
lotment of these bonds, and, besides. ac-
quired additional rights Of purchase on
these bonds.
Purchases of Common Stock.
In addition it has made other large pur-
chases, chiefly of common stock, recently.
and it may be said that the company has
had to pay about ruling prices for its in
creased interest in Baltimore and Ohio
Pennsylvania's interest in Baltimore and
Ohio was first acquired around December,
1899, and these purchases were practically
fhn frct dow a11ya,,
ing into the properties of the seaboard soft
coa1-carrying railroads. But while in the
Chesapeake and Ohio and the Norfolk and
Western railroad the Pennsylvania rep
resentatives have dominated the policy of
these companies for the past year, this
has not been the case in the Baltimore
and Ohio. The Pennsylvania representa-
t1ves were not only a small minority in
that board number, but their ideas have
been overruled on a number of important
questions Their earlier interest was in the
preferred stock, their purchases in these
shares having been induced, 1t is believed,
by the idea that the issue was relatively
cheaper than the common shares and own
ership in that issue would give them the
same influence in the companys affairs
Opposed to Improvements.
In this position they have not favored
the special developments of the year.
favoring the position of the common
shares. They did not favor the declara-
ton Of the dividend last summer on the
common stock, though on this, as on other
questions, the board acted unanimously on
final votes. It is believed that the legal
action begun to prevent the payment of
the common stock dividend, though in the
name of small holders of preferred shares
was possibly inspired by Pennsylvania in
terests: The allotment of the unissued
&6,399oQ0) common stock in May, 1900 to
shareholders at SO was also believed to be
opposed by pennsylvania interests, who
rather favored its issue, if it was to be
put out at ALL by syndicate subscription
That these differences had some part in
inducing the Pennsylvania road to en-
large its interest in Baltimore and Ohio
and to buy into the common stock is prob
ably true, but the effect of it has been not
only to increase the amount of Pennsyl-
vania's holdings, but the cost of the shares
acquired.
Mr.. SalOmOn Entitled to Credit.
With the Pennsylvania interests finally
controlling the policy Of the company,
Chairman Salomon will give up his rail-
road career. He has been actively iden-
titled with the Baltimore and Ohio since
the reorganization plans were undertaken
and has been chairman since the new
company was formed and he is to be fair
ly credited with developing the policy
which has SO largely brought about the
great expansion In the Baltimore and
Ohio's utility as a transportation route
and made its capacity for securing and
moving business SO evident that the Penn
sylvania railroad has felt it necessary to
control the property. Both stock issues
are now measurably near par, though un-
der the weight of litigation involving the
dividend rights of the two issues and pres
ent prices compare with about 80 for the
common stock and 20 for the preferred,
when the new company took over it's prop
erty. j. T. H.
FOSTER AND DICKINSON INDICTED,