The Washington times. [volume] (Washington [D.C.]) 1902-1939, 1908-08-10
Would Increase Stock Five
Times and Get Pub
lies Cash.
GOVERNMENT SUITS
HINDER STOCK DEAL
Rebate Prosecutions and Dissolu-
ton Proceedings in Way-Can
Hurt Republican Chances.

WIN the y dIaQaLQ Nli company at
work on plaTs TO increase It's capital /
stock from 100000 TO probably $780, /
Od0,O0O. and with the Government night
ing 10 get the big corporation dissolved. !
the question d which side Will get 70 it 4
hrst is becoming one OF absorbent in
teTest.
In connection with the proceedings in /
the great rebate cases against the /
Standard e Eas become apparent that i
the Government wants TO keep those /
cases very much alive as long as pos |
sIble, 10 embaTrass the trust in its ef- /
forts to pull of the big performance IN /
stock watering. Ii would be difficult |
for the Standard To float the huge issue /
OF additional shares at a time when !
suits involving the possibility Of some /
thing like so, 900 90 IN nness and also /
menaCiug IL with possible dissolution. !
were All pending.
Likewise it is realized that II the !
Standard wanted 10 injure the Repub- |
lican party IN the Presidential hght this !
year, II could hardly hnd a more effec- |
tive method t0an to proceed calmly and
insolenJly 10 carry out its plans for in
crease Of cap! !talizatiOn. That develop
ment would he accepted by the county
as demonstration OF the hopeless tutil- |
ity Of the anti trust crusade Of the Gov
ernment
Cannot Prevent Increase.
Nobody is disposed TO question that
the Standards property is worth
the half-biIlion for which its manage
ment is understood 10 desire TO capital
ize It. Its annual dividends for a long
series of years have been ample TO keep
a half-billiOn oi capitol above par. while
II is we'll known thai beyond The divi-
and has added immensel 20 its proper
ties. 1t is altogether pT )bable that 10
legal means exist 10 Irevent the m
crease OF capital; rather, 10 Is learned at
the Department Of Justice that no par
tiCular consideration has been given
thus far 10 that phase OF the matter
Tho department has heard with interest
the constant and ciTcumstantial reports
that the Standard Wants 10 increase its
capital, but has nc of.icif3 information.
Should the capital be raised 10 $780,
600 900, and should the 0iE concern come
on hand, the expectation 10 that the
stock woulc be allowed to secure a
wider distribution thaE ever before.
At present Standard Oil is very little
dealt IL because II is closely held with
in a small group. But II TIE capital
were increased as proposed, me gener-
al expectation Is that the present hold
ers would allow d large share Of the
=
circumstances were favorable for float
ing il. This would serve two purposes,
both decidedly TO the advantage OF the
Standard people.
First, it would get a great number OF
small shareholders concerned about tie
company and its future, and would en-
list a powerful influence to prevent or
at least 20 ennbarrass future prOsecu-
tions Of the company. Second, 1t would
enable the present holders of Standard
-. L. ma RI ~
ings Tor cash, which they are supposed
very much 10 want at this time. They
could easily do this without in any
wise jeOpardiZing their control OC the
when the stock OF a big concern is
widely scattered, for the insiders to
have anything like a majority in order
10 retain control and all the benefits
Of control
Want to Buy Railroad Shares.
Thus the managerial crowd in Stand
ard oil would be able to realize a huge
sum in cash, with which, it Is strongly
believed. thew would set about further
to strengthen the hand they hold In
the national railroad situation by buy
ing railroad shares during the period
# comparative depressI61. It is now
universally believed that shares are go
ing TO have upward movement, that
dividends will rise and that railroad in
yestments viii shortly he restored 10
the class of the most highly Desirable.
The Standard Oil people see and know
this. They are already thS greatest rail-
roaC investing group in the country.
They stand back Of the great operations
of 10. II. Hartman. and are unquestion-
ably anxious to strengthen themselves
stIl further in this field.
Here then, Is believed TO be the eX-
nIanation of the Standard Oil party's
bositIon Really concerned about pos
slblc dissolution OF Che Co-porF ton IN
the S. Louis case. tsey Woulu Ike, be-
fore an issue is rei.ched ia that case,
10 win a decided victory in the big
rebate cases. on the strength of which
they night be able to float the big
stock increase. Then, whether they won
or lost at St. Louis, they would have
the money; II they won, they would still
retain enough stock to keep control.
And with the money they could inn
mensely consolidate and strengthen their
position in the railroad world.
Railroads Cheap Things to Acquire.
F Il. Hartman issued $10O, ,OOO, 600 OF
Union Pacific convertible bonds sold
them. and with the proceeds laid the
foundation of the expanded and stin
sxpauding Hartman system. With an
other 500 600 900 Of $SO0.OJO,9O Of Stand
NV iudieious purchases of the right
stocks. are almost unbelievable. It is
pointed out that railroads are mighty
cheap things to buy. Half or more OF
the Capitalization is represented nv
bonds. which don't enter into the con-
troll so long as interest is paid The
other nalf or less is in stock: and il
isn't by any means necessary to have
a majority Of the stock, nor q per cent
of the whole capitalization of the road.
| TO secure absolute control.
Closely held and secure, vastly less
than half the stock will control anv
system. barring the possibility OF such
COUP as that Of Gates in the Louis
Vile aad Nashville.
The Standard Oil litigation and re-
organization is thus looked upon as
intimately related TO future railroad IL
nancial developments Mr.. Hartman
now has something like 5000 miles OF
railroad; perhaps good deal more.
substantially in his control With the
liquidateC resources Of the Standard
group he would presently be able COM
pletely TO dominate tho whole trans
portation fabric of the country.