The Salt Lake tribune. [volume] (Salt Lake City, Utah) 1890-current, 1906-12-16
GOVERNMENT TAKES
CONTROL Of ROADS
Details Of Railway Merger Com
pleted by the Mexican
Republic.
LINES AGGREGATE
TEN THOUSAND MILES
Syndicate of Extraordinary
Strength and International
Scope Backs Merger.

CITY OF MEXICO, Dec. l5.-The De
tails Of the railway merger, by whlcp
the Mexican Government takes control
Of all the important lines in tho repub
lie, are now known.
Bv the terms Of the contract the
Government secures absolute control of
the Mexican Central the National, the
International, the Interoceanic and the
Uidalgo & Northeastern, all of which
will be merged into one great railroad
system The Government also comes
into control Of the TeNas.M Mexican, a
railroad at Laredo, Tex, which is
owned by the National. The mileage OF
the system will, with extensions which
are rapidly nearing completion, aggre-
gate approximately 10000 miles.
The Tehuantepec National and Vera
Cruz & Pacific, two other railroads con
trolled by the Government, will CON
tinuc to be operated rs independents
companies.
A Mexican company. of which n ma
joritv of the stock viii he held by the
Mexican Government. will be organized,
with headquarters in Mexico City. The
company will issue its securities in ex-
change for the securities outstanding Of
the two companies. and the new com
pany will acquire all the physical prop
ertv and concessions held by the old
companies 1t is contemplated to create
2 board of twcnty-one directors to be
divided into a general board which will
reside in Mexico and a local board
with kcadquarteVs in New York. The
board in Mexico will consist of twelve
members and the New York board of
nine.
Bonds Guaranteed by Government.
The new company viii make n limit,
Cd issue of prior liens at 4 II per cent
and general mortgage bonds at per
cent. the principal and interest of the
latter being guaranteed by the Mexi-
can Government In addition to the
bond issues, the company will issue
first and second preferred and common
stock II is proposed to leave an ample
reserve in cash and securities for future
Improvement, development and cXten
sion Of the lines of the company and
for the acquisition of additional rolling
stock and motive power
II is expected that by n reduction of
The general charges, the elimination Of
competition, the economical routing of
freight and by the increased develop
ment of the properties, the new COM
pnny will not only be able to meet its
fixed charges. but viii earn, at an early
date, divivends on its first and second
preferred stock.
Banking Houses Interested.
The banking houscs interested in the
transaction are composed Of the firms
of Lndcnburg, Thalman & Co. and Hall
sarteu & Co of New York, bankers Of
the Mexican Central railroad; Spier &
Co. of New York, bankers Of the Ma
tional roads; and Kuhn, Loeb & GO.
OF New York. who represent the Mexi-
can Central company, limited, of Lon
don In addition TO this group, some
of the largest bankers Of Paris, Berlin,
Frankfort and London are interested in
the banking syndicate, thus forming
combination of extraordinary strength
and international scope. The National
Bnrk Of Mexico will participate in the
financial operations.
PAbo Mariner del Rio, In February.
with n view of bringing the Mexican
Central in touch with the Mexican Gov
eminent The project was subsequently
discussed by Minister Limautour while
en- route to Europe in May last, and
also during Minister Limautour S stay
in Europe. The negotiations, in a more
definite form, became active while Mr..
Limantour was in New York on his re-
turn trip from Europe. They were
finally brought 10 an issue in the last
few days during the visit of Eben Rich
ards, president Of the Mexican Central
and personal representative of Henry
Clay Pierce and Walter T. Rosen Of the
firm Of Lsdenburg, Thalman & Co., rep
Tfspptinu the fnreicsn bs mixers