New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1912-12-03
WALL STREET TAKES
DECISION CALMLY
Pacific Railroad Officials and
Bankers Refuse to
Discuss 1t.
STOCK AND BONDS RISE
Other Roads May Be Affected
-Harriman's Merger and
Governments Fight
Against It.

Wall Street has awaited the decision in
the Pacific Railroad case with great in
terest. but no comment was made yester-
day BY any officials OF the roads in this
city, nor by any OF the banking interests
represented by Kuhn, Loeb & Co. Robert
8. Lovett. chairman OF the board OF d.
rectors and Mr.. Harriman's successor,
said he had nothing 20 say at this time.
The action OF Union Pacific stock soon
after the decision was announced In
creased the general belief that little was
mean to the stockholders. Al first there
was some heavy selling. but the preferred
stock finally showed an advance OF more
than points on the theory that. in con-
, nection with the readjustment OF security
holdings. the senior issue would be retired
or would come in for a share in the dis
tribution OF the subsidiary stocks There
was also a sensational rise In the South
ern Pacific per cent bonds. They opened
at 50. and later sold at e5.
Railroad attorneys were OF the opinion
that the decision may result In the re-
linquishment OF the control OF the Central
Railroad OF New Jersey by the Reading
company. They also expressed the be.
lief that the control by the New York,
New Haven & Hartford OF the New York.
Ontario e. Western and the Boston e.
Maine may be affected. other questions
OF vital Importance to the railroad world
that may be taken up are the control of
the Lake Shore and the Michigan Cen
trail by the New York Central and the
Pennsylvania holdings OF Norfolk &
Western.
Tho combined capitalization OF the
Union and Southern Pacific systems
amounts to t1,ol7. 221, COS, OF which s5Ss,sl5,-
soS consists OF stock and S45s. 375. 100 or
bonds. Union Pacific has outstanding
sis. 800 Of common stock and s9s, 54s, 600
OF preferred stock. and bonds In the
hands OF the public aggregating 1929. 232.-
$50. Southern Pacific has only one class
of stock which Is outstanding to the
amount OF s272. 672 ,4O5 and its bonds issued
total sl29. 143. 40. At the end OF June. 1911.
Union Pacific was operating, with its
auxiliaries and trackage rights. 3.447 miles
of road and the Southern Pacific 1858
miles. making a total for the two OF 6.sl5
miles.
How Hartman Merged tho Roads.
The presence OF Edward II. Hartman
as a leader In the railroad world was not
recognized until 1899, for up to that time
he had been working quietly to accom-
plsh the ends he had In mind. At the
close Of the Spanish war he had bought
the Chicago & Alton for his associates I'm
the Union Pacific, of which he was the
chairman OF the executive committee. The
other members OF the syndicate were
James Stllman. Jacob III. Schin and
George j. Gould. Mr. Hartman had gone
into the Union Pacific with the Kuhn
Loeb Rockefeller interests. who had
bought the road from the United States
government In 1897. The old road, built
first as a national enterprise. the first
transcontinental line, had fallen into such
a state OF decay that II was described as
a right of way and two streaks OF rust.
Dividends had long been thing Of the
past.
Mr.. Hartman believed IL TO be highly
valuable property, and II was purchased
In bankruptcy for sl4,oOo.0oo. The road
had the bed. grade and equipment OF
thirty years before. and II was isolated.
running from an inland town TO desert
village. It's western feeder and original
twin. the Southern Pacific had become
| rival, carrying to New Orleans the tom
mage that should have gone TO the Union
Pacific. Mr.. Hartman, who had his
training under Stuyvesant Fish, whom he
later drove from the presidency of the
Illinois Central, assumed the task OF re-
building the road. There was a great
deal to do, and 1t took ssO,OooooO to do it.
After the physical difficulties of the re-
| building had been overcome, the question
OF getting business arose.
Within a year after the Alton purchase
Mr.. Hartman tried to buy the Central
and the Southern Pacific from Coils p.
J Huntington, but Mr. Huntington refused