The Birmingham age-herald., 1913-02-07
PLANS ANNOUNCED
FOR D|SSOLUTIONOF
RAILROAD COMPANY
Union and Southern Pacific
Companies Obey Decree
of Supreme Court
JOINT STATEME7 : )
ISSUED b T )ADS
S9
80
Terms for Dissolution 81 e Approval
of Department of Q g eAAgree-
ment Now A. The Con-
firmation On Court


firmation On Court
New York February 6.-Plans for the
dissolution of the Union Pacific Railroad
company and tie Southern Pacific COM
pany as decreed by the United States
supreme court were officially announced
in detail tonight after a protracted ses-
sion of the directors Of the two COM
panies The terms are said in state
ment issued Jointly by the roads. to have
the approval OF the department of justice
at Washington and the agreement now
awaits confirmation of the court in the
federation district where the action orig
inally was taken and by the railroad com
mission of the state of California,
In accordance with recent ntimations,
ern Pacific results In tnion Pacific's abb
solute purchase of Central Pacific. which
has been the bone of contention between
the two principal roads of the Hartman
system
The agreement also provides Tor the
sale of all the Southern Pacific stock
held by Union Pacific at aSsse with ac-
erued dividend to the stockholders, COM
mon and preferred, of the Union Pacific
and Southern Pacific other than the Union
Pacific and Oregon Short Line.
1t is understood that syndicate has
been formed under the head of Kuhn,
Loeb & Co. and their foreign connec-
tions to finance the sale of Union Pa
eific's holdings of Southern Pacific.
amounting 10 S126.650 600
The Official statement issued Jointly by
Union Pacific and Southern Pacific fol-
lows
THE boards of directors of the Union
Pacific Railroad company and Southern
Pacific company at meetings held today
approved plans which have been under
consideration by special committees for
several weeks and which have been
worked out with the attorney general.
subject to the approval of the court as
follows:
Purchase Central Stock
"The purchase by the Union Pacific
of the entire capital stock of the Central
Eaeific consisting OF SGI. 300 par value
of common and ST. i0AoQo par value pre-
forfea. for the suIf el 3io51s9,9il- the cost,
at which ii stands upon the books of
the Southern Pacific company. Eighty
four million, six hundred and seventy
five thousand five hundred dollars of
the amount was to have been paid IN
stock of the Southern Pacific company
held by Union Pacific at par, but legal
difficulties having been found In the way,
the plan has been changed so that pay
ment is to be mad> as follows viz:
one hundred and twenty-six million six
hundred and fifty thousand dollars, par
value, being the entire amount of stock
OF Southern Pacific company held by
nion Pacific, Is to be Offered TO the
stockholders, common and preferred, of
the Union Pacific and stockholders of the
southern Pacific company, other than the
Union Pacific and oregon Short Line, for
subscription at 9sss per cent and accrued
dividend This offer Is to be underwater
and subscribers are to receive the div-
dend payable April l. 1918 "details to be
gwen latei). The proceeds of $S4, 67550O
OF this stock, less the underwriting com
mission and expenses, is to be paid over
TO the Southern Pacific company together
with S5,449,o00 Of the Southern Pacific
eempany's 1 per cent gold bonds and sl4
o65, AL in cash.
Court Must Approve
"The Attorney General of the United
States has assented to the essential feat
ures of this plan, but II is of course sub
ject to the approval of the district court
in which the government litigation is
pending, and also dependent upon the
approval BY the California railroad com
mission of agreements for certain track
age and running rights in that state. The
Yian and agreements win be presented TO
the court and commission with the least
possible delay"
Southern Pacific company. in discussing
the sale of the Central Pacific stock by
the Southern Pacific company, stated that
while the directors have not decided what
disposition to make OF the money they
received. a considerable part of IL will be
needed in the near future 70 pay for ex
tensions, equipment and betterments. The
amount is sufficient to take care of fu-
ture requirements. he said, without in
crease Of fixed charges.
Mr. Kruttschnitt also stated that at
meeting with the Southern Pacific stock
holders protective committee this aft
efnoon the plan agreed upon by the
boards of the Southern and Union Pacific
was approved unanimously.
Judge X. S. Lovett, chairman of the ex-
ecutive committee of The Union Pacific,
said IN a statement tonight:
If the plan is consummated the lease
and operation of the Central Pacific by
the Southern Pacific company will of
course cease. and the Central Pacific
Railway company will enter upon the
operation of it's own lines with com
pictt LIBERALIZATION III California from
pi esident down. The president of the
Central Pacific will have fully as much
with respect to those lines as
the president of the Southern Pacific COM
pany has over its lines.
THE published reports that the Central
Pacific Is to be leased 10 or merged into
the Union Pacific railroad are without
foundation. The Union Pacfie's control
will be through ownership of stock of the
Central Pacific. the operations being car
ried on By the Central Pacific Railway
company and in its own name
Washington. February While no
formal statement was Forthcoming. Of
ficials of the department Of Justice
tonight indicated That the plan for
dissolution of the Union Pacific South
ern Pacific merger, agreed upon by the
two roads, would he approved In ali
by Attorney General Wick
The Attorney General held a
long distance telephone conference late
in the day with reoresentatives of Tho
railroads in New yerk who outlined 10
if'n fhe - as et 'ie agreement. The
Views OF Mr.. Wic'Sersham We're well
known to the roads as the result Of
several weeks negotiations.
Newspaper Man Killed
Abilene, Tex. February 81 r.
Bond, formerly a newspaper man OF