Evening star. [volume] (Washington, D.C.) 1854-1972, 1906-09-04
PENNA. R. RS BIG SALE
HALF IT'S HOLDINGS IN TWO
ROADS DISPOSED OF.

The Pennsylvania Railroad Company has
disposed Of one-half Of Its share holdings
in the Baltimore and Ohio and the Norfolk
and Western railroads. An announcement
to this effect was made officially last night.
The stocks. approximating 3ss,O0O shares
with a par value Of $3s.SO0.000. were sold
to Kuhn, Loeb & Co. Of New York.
By the move the Pennsylvania loosens
its grip upon two big trunk lines, but not
until the management is assured that its
own traffic interests will remain unframed
by the giving of rebates or any other pref
erences to shippers.
The action of the railroad company in
disposing of SO much OF It's securities Is
considered a victory for the untiring eff
forts Of William A. Glasgow, 5r., VINO as
special counsel for the interstate commerce
commission showed that the pennsylvania
railroad management controlled the tide
water coal situation with an iron hand.
It is also considered a victory for the new
railroad rate bill, which went into erect
on August % last, and which is expected
in turn to protect the Pennsylvania roao
from its former traffic enemies.
An Interesting Announcement.
The announcement reads
1.-THE Pennsylvania Railroad Company
announces that it has sold a part OF its
holdings of Baltimore and Ohio and Nor
folk and Western shares. These stocks
were purchased some six years ago for the
purpose of establishing such relations with
the arrangements Of those properties as
would incline them to join the Pennsyi-
vania Railroad Company in an effort to DO
away with secret rebates and preferences
all Of which was set forth In the annual
report of the directors Of the Pennsylvania
Railroad Company to the shareholders IN
March, 1900.
THE desired result having been fully real
lied, and the management entertaining no
fears that the railroads OF the country VIII
ever fall back into the old PRACTICES, the
directors of the company had thought 1t
wise to reduce its ownership In these COM
panies, which had been done by selling APP
proximately one-half of its holdings In each
to Messrs. Kuhn, Loeb & Co. On account of
the allegation, repeatedly made, that the
company was seeking to control the tide
water bituminous coal traffic. the directors
had taken this action in Difference to the
present state of public opinion upon such
matters, although there was no foundation
for the charge, and although 1t was conf
IDENTIFY believed that the company was en-
tirely within it's legal rights in purchasing
and holding these stocks"
Roads Holdings in December.
According to the annual report of the
Pennsylvania railroad for the fiscal year
enQeQ december 1cUo, SHc COHPdAy
holdings in the Baltimore and Ohio rail-
road consisted of 214,SO0 shares of preferred
stock and 800, 1888 shares of common stock
a total of 517,733 shares. whose par value
aggregated $51, ia, 800. Its holdings In the
Norfolk and Western railway consisted of
2O3. 800 shares of common stock and $1,000
shares of adjustment preferred-a total Of
258,300 shares, whose par value amounted
to $25, 600.
The Pennsylvania received from these.
holdings an Income aggregating 3,153, 948.
OF this amount 1920, 1893 was derived from
the holdings in the Baltimore and Ohio
road, while the Norfolk and Western stocks
produced 1891, $50 With these interests the
management of the Pennsylvania was able
to dictate the policy of both of these rail-
roads. Many changes were wrought and
for the last six years the Pennsylvania in
terests controlled the traffic situation east
of Chicago and south of the territory con-
'trolled by the New York Central system
and throughout the soft-coal fields of Ohio,
West Virginia, Pennsylvania and Mary
land
The Directors Report.
The section of the annual report Of the
directors for 1900, to which the announce
ment refers, reads:
while the growth Of your traffic and its
successful movement are subjects for con-
graduation, your board has to report
further reduction In the average ton-mile
rate. OF years lne compensation OF the
trunk lines for moving freight traffic has
steadily decreased. On your road it appears
that, with but one exception, there has
been in each year since 1889 decrease in
the rate from that of the preceding year,
SO that from an average per ton-mile rate
Of 0.6S6 cents in 1889 the rate fell to O.499
cents in $685. and last year to O.473, the
lowest point ever reached. AS may be sup
posed, railway managers have not seen this
constant reduction without serious concern
or without strenuous efforts to check the
downward movement. These efforts have
met with but little success, and although no
commercial necessity has recently existed
for such reductions, and certainly not dur
ing the past year, when the Industries of the
country enjoyed prosperity almost unpre-
cedented, and when the facilities of the
railway were taxed to the utmost, the fall
in rates has still continued.
Had the railway companies not been able
to meet the diminution in the ton-mile rate
by corresponding reduction In expenses
disastrous results must have followed. But
there is a limit and it cannot be far off, to
the possible lessening of the cost of move
ment. The only alternative Is to arrest the
reduction in revenue, which has been large
ly brought about by apparently uncontrolla-
BILE conflicts"
The sale of the stocks will give to the
Pennsylvania railroad about $4,000, coo,
which will be used in financing the extern
sive improvements in New York not already
cial statement from an officer of the COM
pany, about $4O,OOO,0O will be needed to
complete this work. This will provide the
funds without the issue of bonds or the in
creasing of the company's capital stock.
Anacostia and Vicinity.
ot,ar 40 nnf nho NV of