The Lee County journal. (Leesburg, Ga.) 1904-19??, 1906-12-21
MEXICAN ROADS
TAKEN OVER
By That Government and Merged
Into One Big Company.
IS FINANCED BY BANKERS
System Will Comprise Over Ten Thou
sand Niles of Railway and Many
Extensions are Contemplated.


The details of the railway merger,
by which the Mexican government
takes control of all of the important
lines in the republic, are now known.
By the terms of the contract, the
government secures absolute control
of the Mexican Central. the National,
the International, the mter-Oceanic
and the Hidalgo and Northeastern,
all of ~hich will be merged into one
great railroad system. The govern
ment also comes into control OF the
Texas Mexican, a railroad at Laredo.
TexSs, which is owned by the Ma
tional. The mileage of the system
will, with extensions, which arc rap
Idly nearing completion, aggre. ,atc ap-
proximately 10000 miles.
The Tehauntepec National and Vera
Cruz and Pacific, two other railroads
controlled by the government,wil CON
tinue to be operated as independent
companies.
A Mexican company, of which ma
jority of the stock will be held Oy
the Mexican government, will be or
ganized with headquarters in Mex
leo City The company will issue
its securities in exchange for the Sc
curlties outstanding of the two com
panies and the new company Will &C
quire all the physical property and
government concessions held by the
old companies.
1t is contemplated to create board
of twenty-one directors to be divided
into a general board when will re-
side in Mexico and a local board, with
headquarters III New York. The
board in Mexico will consist of twelve
members and the New York board OF
nine.
The new company will make linn
tied issue of prior lien bonds at 4 IL
per cent and general mortgage bonds
at 4 per cent, the principal and inter
est of the latter being guaranteed by
the Mexican government.
In addition to the bond issues, the
company will issue first and second
preferred and common stock It is
proposed to leave an ample reserve
in cash and securities for future inn
provement, development and extern
sion Of the lines of the company and
for the acquisition of additional roll
ing stock and motive power. The new
company will take over the holdings
of the National railroad OF Mexico
and the Mexican International and
Inter-Oceanic railroads, which 1t VIII
thus control, as they are at present
IN control, of the National 1t is
expected that by a reduction of the
general charges, the elimination of
competition, the economical routing
Of freight and by the Increased deyel-
opment Of the properties, The new
company VIII not only be able to meet
its fixed charges, but will earn at
an carly date dividends on its first
and second preferred SLOck
The banking houses interested in
the transaction are composed of the
firms Of Ladenburg. Thalman & Co.
and Hallgarten & Co. Of New York.
bankers of the Mexican Central rail-
road; speyer & Co. Of New York.
bankers Of the National lines and
Kuhn, Loeb & Co, Of New York,
who represent the Mexican Central
Security company, limited, of Lon
don. In addition to this group some
of the largest bankers in Paris, Ber-
lin, Frankfort and London are inter
ested in theb anking syndicate, thus
forming a combination of extraordinary
strength and international scope