The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1903-08-11
WHY CHEMICAL
SECURITIES FELL
Fight Made on Company. OC-
Casion Being Legitimate
Effort to Borrow Money.

In the present state of the New York
Stock Exchange there is abundant oppo-.
tunity for the maker 81 rumors, and
naturally there have been many rumors
there and here and elsewhere concerning
the Virginia Carolina Chemical Company.
The facts of the case SO far as they
can be ascertnined are about as follows:
1.-THE Virginia Carolina Chemical Co., does
a large business and needs great deal OF
money to carry on Its affairs. 1t sells II
fertilizers on credit. it's bills being we'll
secured, but not payable until some time
between November and December, when
the cotton crop has come in, The 'cbm-
pany usually borrows money to purchase
It's raw material either by Issuing Its own
bills payable. or by dlscountng Its bills
receivable, and up to short time ago
1t had no difficulty In raising money for
this purpose and in this way. Sometimes
the company has large floating 'lchts. far
the reason that it has made expenditures
In purchasing raw material. and has 10
wait until the crops are harvested before
collecting It's bills receivable. This year
1t had to borrow more money than usual.
because Instead of manufacturing ~
500 900 tons of fertilizers, ms in 1902. t h's
manufactured and sold 100000 tons. Or
dinarily 1t would have had no difficulty
in borrowing all the money needed, fov
the company has a good business, but az
this particular time the hanks We're very
careful about making loans and many OF
them did not care to discount CONNER
clal paper. The facts got out that tho
company was on the market for money
and under tho peculiar conditions prevall-
ing on Wall Street the most was made
of It. The companys stocks vera YolsntlV
attacked and prices crumbled away. Added
to this fact were all sorts of absurd rn-
mors, enough to destroy the credit. II .I "
ia wreck almost any company IN tb0
country,
But the Virginia. Carolina Chemical
COMPANY has n splendid business, and II
has good friends in banking circles. IL
IL said that Mr. j, r. Morgan came to
its rescue as soon as the situaelcn wss
laid befo him. and agreed to negotiate
a loan of S5.000,0O0. 1t Is not to he pre-
sumed that Mr.. Morgan lent this money
himself, hut that he made the loan on hle
own account and then apporticne'i 1t out
to several banks with which he Is assoc
ciated At any rate the company sot the
money through Mr., Morgan's good offices.
and 1t Is said that the sum borrowed ~
sufficient to take care of all of the float
Ing obligations and to give the company
all the capital it needs to carry on It's
business,
AS to whether or not the company will
paw the usual dividend on Its common
stock, The Times Dispatch has no means
of knowing There is good reason to be-
lleye. however, that this money was
loaned on the open note OF the company
without any harsh conditions and wi'h-
out any promise on the part OF the COM
pany that 1t will not pay the usual dlyi-
dens on its common stock, Ihat Is
matter for the directors To decide. ana II
may be mentioned that the banks which
have loaned this money Will now Lave
three representatives on the hoard