Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1908-09-05

Deen Iudue. NO OlVlQeHuS nave Deen
paid on the stock. The company's bal
ance sheet of June 80. 1908 shows de-
fict Of s24, 10S.65. Considering the num-
Der of subscribers this is fairly COM
parable with the Northeastern Co.'S
deficit of $59,377.2S.
The Cumberland Telephone Co., the
smallest of the three companies, was
organized under the general laws of
the state of Maine, July 49, 1903. with
a capital stock OF $4,000. divided into
100 shares of common stock of the par
value of 500 EACH and 400 shares of
referred stock of the par value of 500
each It's territory is mainly the town
of Gorham and city of Westbrook, and
it started in business with about 81
subscribers which have decreased to
IS in the last five years. 1t never is
sued any bonds and the dividends it
oaid during the years 1904. 1905 and
1906 We're not earned. The balance
sheet of June 80 1908, shows deficit
of $206420.
Briefly told the story of all three of
these companies is that they have been
run at Il loss, which is even greater
than the figures quoted show, for no
allowance was made by any of them
for depreciation. Taking the cost of
the plant and the items Of the construc-
ton account at their book values and
making the modest estimate Of eight
per cent. depreciation. these companies
should have set aside for depreciation
during the last year $780, 149. Against
this there is nothing. With these val
ues the cost per station for the North
eastern was $40S, for the Lewiston All
burn 1926, and for the Cumberland 1898
The average cost for all the Bell COM
panies is Sl49 per station.
With the companies in this condition
there came to the New England Co. a
representative of the majority stock
and bond interests with an offer to SELL
The offer was declined as being unsat-
isfactory in substance and detail. The
management of the New England Co
did not care to make the purchase.
a bad example was more valuable to
the New England Co. than a bad pur-
chase But in justice to it's own stock
holders it was bound to consider what
might prove to be good bargain. 1t
made careful investigation of the
Plant and liabilities of the three conf
panies. After many conferences and
much correspondence it in its turn
made an offer to purchase. The offer
was accepted.
The seller agreed to assign certain
unsecured Indebtedness, to pay the re-
ceiver's salary, attorneys fees in e%-
cess of S25 1000, certain receiverSnip eX
penSeS, and to pay all other Outstand-
ing Indebtedness other than bonded,
this for al; the companies. In addition
he transferred to the New England
Telephone and Telegraph Co. $2o,5Oo
receivers certificates of the North
eastern Co., s475.000 bonds and $3SS,500
stock of the Northeastern. $4,000
bonds and $144.900 stock of the Lewis
ton-Aupurn There is in the treasury
Of the Northeastern Co. $40,129 of its
own stock, $4,000 of the stock OF the
Lewiston Auburn. and $4,000 of the
stock of the Cumberland. For all of
this including AS it did $1.662,30O of
securities the New England Telephone
ard Telegraph Co. paid the sum of
1925, 900 This gives the New England
Co. 70 per cent. of the bonds of the
Northeastern Co. and SO per cent. Of
the bonds of the LewistOnA Auburn.
A matter of interest to the public
in connection with this purchase
is the question of rates. These
subscribers who had both Bell
and independent telephones will get
their service cheaper. Those who
had only the Independent telephones
| may have to pay more. For manifesty
the rates were not adequate to main
| tain the companies existence. There
| is a living rate just as surely as there
| is living wage. but it is gratifying
to say neither the existence nor the
| passing CT competition has affected ot
will affect the New England Telephone
and Telegraph Cos. charges for ser
vices in the cities Of Portland, Lewis
| ton or Auburn.
| For additional stock and bonds
| though not necessary for the control
the New England Co. will negotiate or
| the same basis on which it secured the
.,,<o