The Hawaiian gazette. [volume] (Honolulu [Oahu, Hawaii]) 1865-1918, 1904-07-26

not start up at all but that the insiders
were content to make profit out OF
building the plant and floating bonds at
a good profit; that the same methods
would be followed with the New York
plants as at Philadelphia. and that in
the end the bondholders might have an
opportunity to take hold and manage the
properties. 1t was reported that the
Philadelphia concern had not sufficient
working capital TO start TIP with: never
theless II seemed to have abundance of
resources to meet the interest on its
bonds at it matured.
These bonds have been drawing in
terest since July /. two years ago. They
are described as first mortgage bonds.
but from advices received from Philadel-
phia it appears that there is a real estate
mortgage for $4,000 prior thereto. which
forms a first lien, until they are retired.
This gave rise to an extravagant story
that the first mortgage bonds were moth
ing more than a second mortgage issue
Another story had it that the Philadel-
phia company was to be transferred TO
the New York refining company, for
some unexplained reason.
A wellknown refiner. associated with
the American Sugar Refining Company,
said:
"The scheme is probably for a con-
struction company to build a refining
plant and sell it to a sugar refining cor
poration, taking in payment bonds, Sc
cured by mortgage on the plant more
than its cost to construct, and an amount
OF capital stock corresponding to the par
value of such bonds. The bonds are
then offered at par, and enough stock
given as bonus to tempt the investor.
In this way the original constructors
light out profit, and are ready to tempt
the public again by similar methods.
The refiners are not likely to operate
under such circumstances"
a representative of the Federal Sugar
Refining Company expressed the opinion
that the new Segal refineries are con-
trolled by the Trust, and if they are not
run it is because Mr. Havemeyer does
not want them to be operated. But, he
added, the growth of the country ap-
peared to warrant the erection OF a new
refinery every year and half.
WHAT MIR. SEGAL SAYS.
Mr.. Sega spoke without reserve in
regard to the intention of the several
companies, except that he did not say
much about the men who furnished
most of the capital. 1T is true" he said,
that a move is on foot to combine the
Philadelphia refinery and two New York
refineries under holding company and
a meeting for the purpose has been
called. The method of building our re-
fneres has been for construction COM
Champion Construction Com
pany-to put them up and take bonds
and stock of the owning company in
payment-the stock being given as a
bonus. Inc securities that have come
on to the market were sold by the con-
Struction company. Who controls the
Champion Construction Company? | am
the principal one in it. Our company
has successfully put through many new
and at the present time it has
under way amounting TO about
SIS,oooooo.
"As for the delay in starting tip the
plant that. was due to spe-
,ial reasons, but we will begin operating
October I without fail We are not |
fighting Mr.. Havemever or working with |
him either. made no promise when
sold the Camden plant to the Trust in
1896 not to go into business again. Had |
made such promise | would have kept
IL"