Omaha daily bee., 1907-04-24
UNION PACIFIC FINANCES
Harrimon Road Needs Between eevsnty-
Five and Hundred Millions
OBLIGATIONS THAT ARE ABOUT DUE
Had Company Confined Itself TO
Original Purposes Entire Rail-
way situation would
BE Clearer.

Just at present the Union Pacific rail-
road, with its great reconstructed, e. H.
Hartman, stand in the center Of the stage
with the limelight shining directly on them.
In the east and west they are receiving
general attention and many Of the eastern
papers are devoting great space to the dis
cussion of the finances Of the Overland,
with special reference to the policy of re-
trenchment so recently instituted; in fact
put into effect only since the Nebraska
Legislature got so ''perniciously" busy with
laws which affected its interests. AS con-
sentative a paper as the New York Even
ing Post says on its financial page that the
Union Pacific must raise between S75,OOO.OoO
and S1OO,OO0,OOO by fall to meet obligations
and intimates that this may be one reason
for the abandonment Of such improve
ments as the Omaha general headquarters.
without specifying that projected struc-
ture.
The Post takes the view that had the
Union Pacific confined itself to the pur-
poses for which it was originally intended
the entire railway situation would be much
clearer than It is.
view Of the Past.
The Post has this to say:
Union Pacific sold down TO 1925 last Mon
day, at which price 1t yielded ~ per cent,
on persistent rumors that the company
was about to issue short term notes. As
$500 900 short term notes have been sold
by the railroads since January ], the issu-
ing ~ such securities has been the rule
rather than the exception. But the Union
Pacific was the one road thought to be ex-
empt from the necessity of adopting such
an exnedicnt. II was only four months ago
revealing financial strength heretofore un-
paralleled by any other railway company
Recent disclosures, however, showed that
since the close of the year debts had been
contracted. Then came the pieclng to-
gether of evidence that resulted in this
For the year ended June 30 last, the
Union Pacific earned Is per cent for its
| common stock and reported current assets,
against only SS4,7loOOO floating indebted
ness 1t was pointed out in the annual
statement issued late in November that
| $50 OO0O 600 would be required during 1907 for
| construction of new lines and for new
equipment, but the sum was generally con-
! sidered trifling in view of the cash on hand,
| S100,OOO,0O0 unissued preferred stock and un-
! pledged securities amounting to some $l2O-
| 10000, That was before it was known that
| $l2S. 64lO 900 had been spent for Illinois Cen.
| trail, Baltimore & Ohio, New York Central,
/ Atchison and other stocks and before II
| became impracticable to sell bonds. The
| Union Pacific to use Its cash and besides
/ give the Pennsylvania notes for S45, 466 000.
! The notes mature early in the fall. and the
management must also provide for the S5O
! OOO,0O0 construction and equipment outlay.
| According to the Southern Pacihc's last an
nual report, that company must raise THIS
! year 900 for equipment and enough
| to cover expenditures on account of the
| loo miles of road under construction.
| All told the Union Pacific needs between
SIS, 600 600 and S1O0 900 600, while the Southern
| Pacific could probably get along with be-
| tween $2OOO0,000 and $O,OOO,O00 new money.
| There is no question as to the ability of
the Union Pacific Southern Pacific man.
| agement to raise, all of the funds required
| But, whether or not the money can be
raised on terms more advantageous than
| those offered to Pennsylvania, Lake Shore
| Atlantic Coast Line and other roads with
flrst-class credit remains to be seen.
Eliminating all questions of profits by in.
siders and the loss of $24,00O000 shown by
Union Pacific at one time, on the stocks
purchased last fall 1t grows more and more
difficult to understand why that company's
credit was used to acquire at top prices
minority shares of New York Central
Northwestern, Baltimore & Ohio and North
ern Pacific If the Union Pacific railroad
had confined itself to the purposes fol
which It was originally incorporated the
entire railway situation today would be
clearer.