The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1908-10-12
Indicates End of Long, Hard
Fight on Hartman.
REPORT OF SANTA FE.
For Past Year Makes a Good
Showing.
Road Made Progress During
Year of Depression.

tenn, and which has been the most
formidable competitor of the Harri-
man lines in the middle west and
southwest, has made arrangements
with Kuhn, Loeb & Co., who back all
of Mr.. Harriman's enterprises. where
by that house is to act as fiscal
sidiary companies.
transaction is that the warfare be-
tween the rival systems is to cease.
There is to be no costly competition
in the way of invasion into each
others territory. On the other hand
the companies two systems will CO.
operate on traffic agreements that are
expected to be mutually advantageous.
The Rock Island company was or
ganized by men who almost from the
beginning of their railroad career
have been antagonistic to Mr.. Harri-
man, Kuhn, Loeb & Co., and their as
sociates in railroad enterprises. The
men in control of it, who have since
been distinguished as 1.-The Rock
Island party, were d. G. Reid and
the late w. B. Leeds of tin plate fame,
W. H. Moore and his brother, James
H. Moore of Chicago; and B. F.
Yoakum, who built up and brought
together a number of railroads in the
south and southwest under control of
the st. Louis and San Francisco.
Frisco and Rock Island Joined.
Others have secured control of the
Chicago, Rock Island and Pacific and
under a new corporation, the Rock
Island company. One of the first
achievements of this company was to
wrest the control of the Chicago &
Alton, by quiet and extremely skillful
buying in open market from Mr..
To rir (Ir6V p nd
their associates. From that time until
recently the two financial groups
have been violently antagonistic and
from that time until today it did not
become known that any overtures
even for a truce had been preached
The international banking house of
Speyer & Co., rival of Kuhn, Loeb &
Co, in both New York and European
cities, has been the fiscal agent of the
Rock Island company and many of
its subsidiaries, though the financing
of the st. Louis and San Francisco
had been performed by several firms.
The relations between the Rock
Island party and it's banking firm had,
however. become strained. AS long as
five years ago it, is reported, the rail-
road people had asked the bankers
to put into operation a comprehensive
financial plan which would fund for a
long period the st. Louis & San Fran
cisco obligations to the amount of
about $29, 900, 900, maturing this year
and next.
For some reason the Speyer house
did not complete the financing when
times were propitious. The money
stringency preceding the panic by
several months made 1t impossible for
the time being.
Differ on How Deal Started.
But in the course of the great i'm
provement in the bond market this
year negotiations were resumed. not
only because conditions were favorable
for new financing but because the
Frisco had 81, lbs, 900 notes maturing on
December l. and about $22, 900 900 in
other obligations maturing next year,
and time was pressing. James Speyer,
head of Speyer & Co.. has been in
Europe for several weeks, and the mat
ter of this financing has taken up
much of his attention. He let the Rock
Island people know. as reported last
week, that he had arrangements well
under way for the completion of the
financing.
Meanwhile stories differ as to how
the Rock Island party came in touch
with Kuhn, Loeb & Co. According to
one version the. railroad people sent as
emissary Jacob H. Schiff. and thus in
stituted negotiations. According to an
other, Mr.. Schiff inquired of the Rock
Island party whether it's relations with
any other banking house were so in
innate that a proposition from anOth-
er could not be properly accepted.
Speyer's Final Terms Rejected.
The final terms of Speyer & Co. were
received before the deal was conclud-
ed with the other firm. Apparently it
was the understanding that the Speyer
house was to have the preference,
other things being equal The last
offer of the Speyer firm was received
at the Rock Island offices.
Woo -r1r
called up the local senior partner of
Speyer & Co., and said:
Are these absolutely your best and
final terms?"
That's the last word" is reported to
have been the answer.
deal was off. Half an hour later pc
pers completing the deal with Kuhn.
Loeb & Co. were signed, sealed, and
delivered. The particular deal con-
summated and announced provided
that the bankers were to care for the
81 125 600 notes maturing December 10.
With them in the transaction are as
ISOLATED Hallgarten & Co. of this city,
the NEUTRALITY-SUSPICIOUS. of Berlin, and
other foreign banking houses with
which Kuhn, Loeb & co. are afnla-
ted.
Puts End to All Strife.
No doubt was left that the 500, 900, 900
obligations maturing next year would
also Der refunding by Kuhn, Loeb & Co.
though no definite contract, it is said
both at the railroad and banking Of
fees has been made to this effect.
In both quarters, however, it was
pointed out that no banking house with
the reputation of Kuhn. Loeb & Co.
would for an instant think Of entering
into the financing of a road without
taking an account of the obligations
maturing in the near future, and the
inf aoN0TdinRlV given that
those maturities of next year were GER
tain1y to be provided for.
Both the bankers and the railroad
men insisted that the transaction was
purely a banking transaction as dis
tinguished from a deal for the transfer
of control from the Rock Island party
to the Hartman party. At the same
time it is obvious that an arrange