The sun. [volume] (New York [N.Y.]) 1833-1916, 1908-04-23
UOYHSCHILDS IN PENNG. LOAN
WFTH KUHN, LOEB & 90. As
NEW YORK ASSOCIATES.

go !OOoOOO Are 20 Year first Mort
HagS ~ TO BE Put Out At 08-NOt
syndicate T~rsasHctiOn, II ID Ste, ed.
The ohacisl announcement Of the $4,000
900 Pennsylvania Railroad Company bond
issue yesterday contained the information
that N. NJ. RothSohId a Sons and Barring
Bros. 4 Co. Limited, d London are parti-
oipaAng with Kuhn, Loeb 4 Co. In the
fotation Of the bonds. It was known on
the previous day that q large number Of
the bonds had been placed abroad. but
the direct participation Of the Rothschilds
and Barings In the transaction struck the
financial community SS a novelty Of great
interest and importance. Bankers said that
II was the irst time In twenty-five years
that the ROthschilds had taken part in the
sale Of American railroad bonds and as
far ~ known the irst time In fifty years,
or since the foundation Of the house Of Au-
gust Belmont 4 Co. that the Rothschilds'
American investments had not been made
through that firm. The prospect of further
Rothsohild interest in American securities
vas also regarded as Of prime importance.
Tho ohlcial announcement as given
by Kuhn. Loeb 4 Co. left some doubt as
TO the exact relationship between the three
banking houses ami the relationship
between the banking houses and the railroad
company It was said that Kuhn, Loeb
+ Co., Jointly with n. M. Rothschild 4 Sons
and Barring Bros, 4 Co., have closed a
negotiation with the Pennsylvania Railroad
Company covering t4o,OOO,OOO Of consoli-
dated mortgage forty year 4 per cent.
bonds New Wall Street phpseology
was recognized in the phrase, CLOSING
= negotiation covering bonds'-phrase-
clogy not defined In the dictionaries Of
Wall Street. terms and capable Of several
constructions. II left doubt as 10 whether
the banking houses we're simply acting
~ agents, whether they we're joined
together in a syndicate or as to whether
they had actually bought the bonds. BY
A curious coincidence the new p~arlance
was also employed in the Pennsylvania
Railroad Company's announcement.
A representative Of Kuhn, Loeb 4 Co.
said that the bankers were not acting as
syndicate members nor as agents OF the
company, He refused to state whether
or not the bonds had been purchased out
right by tho bankers, but said that they
would certainly DO sold. The latter as
seTtion seemed obvious enough, for at the
close OF the curb market the bonds were
quoted at "a bid aud par asked and after
ward bids Of 0sk we're made privately.
The issue price to investors or bankers
> securing an allotment from the three bank
ing houses IL "a.
Whatever the novel form Of the relation
between the bankers and the company,
il 6aa said that the three houses had made
no agreement to act together In any future
financing, this statement incidentally fur
nishing denial to the report that Kuhn,
Loeb 4 Co. had succeeded August Belmont
4 Co. as American representatives OF the
Rothschilds. The feet remained that in
ihis n cass Kuhn, Loeb 4 Co. and the
Rothachilds we're acting together, and the
impression was general in banking cir
lies that the success Of this fotatiQn would
be followed by similar cooperation in the
future. The same fact was regarded as
leading some confederation to recent re-
ports Of a severance Of the long standing
relations established by the first August
belmont between the Rothschilds and the
Belmonts.
The form Of the bond Is that OOnsoli-
lated mortgage issue Of 1873 mentioned
Ia THF Sun yesterday. The mortgage is a
,lrst lien, subject only 70 So. 600 gem
eral mortgage 4 per cent. bonds, due July /.
1910 for which consolidated mort gage
bonds are reservedJ, on the main line and
branches OF the Pennsylvania Railroad
Company between Philadelphia and Pitts
burg and on the terminals in Philadelphia
and Pittsburg. II also covers the lease OF
the United New Jersey Railroad and Canal
Company, which is the main line Of the
Pennsylvania Railroad Company from Phila-
delphia 10 jersey City. The consols are
\ legal Investment for savings banks in
New York, New Jersey and Connecticut.
Application for the bonds will be re-
celved simultaneously In this city and
London. No Axed amount has been
awarded 10 stther city. but che allotments
Wll be made with reference 10 the sub
sciptions reoeivSd by every one Of the
three banking houses and the character
Of the application. Subscriptions Of In
vsston win take precedence over those
that may be considered speculative. In
formal applications for q very large number
Of the bonds were made here yesterday.
The formal subscription period will be an
noupoed thts wsk.
The proceeds from the sale Of the bonds,
an odical statement AAys, will be used
10 meet the expenditures upon the New
York tunnels and terminals and for the
aompleton Of other construction work
and facilities already under way and neces-
aa1y for the economical handling Of traffic.
On the local tunnels and terminals So
10000 had been expended prior to January
/ laSL OF this amount tSo,0Oo,0O0 had
ben capitalized and the remainder charged
70 profit and loss. With the exception OF
one Of the two tunnels through Bergen
Hill. which win DO completed In three weeks,
al Of the excavation on the tunnels and
terminals has been finished. In the course
Of the work there have been taken out
100000 cubic yards Of earth and rock
II was the late President Cassatt's plan
10 enlarge the line TO q six track road from
New York 10 P~ittSburg. In accordance
With the plan six tracks have been laid
A. ns..A-- 49,. - &c.. II, H-ta