New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1913-01-12
NO HARTMAN PLAN YET
The Dissolution Details Are Still
UnsoIved, Says Judge Lovett.
BUT MAY BUY c. P.
Meeting To. morrow to Decide
on Further Proposals to the
Attorney General

The Union Pacific Railroad Company
has not definitely determined on the pur-
chase Of the stock of the Central Pacific
as a means Of disposing of its ownership
Of ;l26. 10000 stock in the Southern Pacific
system. This important fact was learned
by The Tribune yesterday and contradicts
the reports given wide publicity during
the last week that this will be the means
whereby the road will conform TO the dis
solution mandate of the United states SUI
preme Court II is quite possible, however
that such a step may be finally taken, as
it l. regarded as logical outcome OF the
present complex situation, which Is still n
riddle Us far as the management OF the
Hartman lines is concerned.
At the railway mems dinner TO Sam
uel Rea, the newly elected president OF
the Pennsylvania Railroad system on
Friday night. I'm Philadelphia, Judge ROD
ert 5. Lovett. the chairman Of the harrl-
man lines executive committee, told a
prominent Wall Street banker that no
decision had yet been reached on a plan
for the dissolution Of the Union ana
Southern Pacific railroads. He stated that
the problem is still unsolved and that the
meeting of directors which is TO be held
tomorrow is not for the purpose OF max
ing any definite plan Of dissolution put 10
ascertain whether the directors Will oack
up the executive committee in certain pro-
posals that may be made TO Attorney
General Wickersham.
IL is said 10 be doubtful whether the
Attorney General can successfully insist
on sale Of the Central Pacific to the
Union Pacific despite his reported con
tention that the Southern Pacific cannot
keep Central Pacific on the ground that
IL is competitor with the Southern IA
cinc route from New orleans. as TINS
point vas not covered by the recent de-
cislon Of the Supreme Court. Nor was
there anything i'm the Supreme Court
remarks that could be interpreted AS or
dcring the Union Pacific 10 purchase the
line from ogden to San Francisco.
Should an agreement be reached with
the Attorney General whereby the Union
Pacific will become the owner of the Cen
trail Pacific line ii is believed that it viii
be because OF desire to keep as much OF
the remaining Southern Pacific stock as
possible for the Union Pacific stockhold-
crs
Tho Central Pacific Railway has an out
standing Capitalization. consisting OF So"-
27j. so common stock and ST2p.ph pre-
ferrcd stock. all Of which is owned 10y
the Southern Pacific and practically all
Of which is pledged against an issue OF
S2s 769 500 Southern Pacific Central Pa
slfc stock collateral 1 per cent bonds.
There IS no way OF determining the value
OF the Central Pacific stock, a. none Of IL
is on the market. 80 that the question Of
fair price would have TO be settled by
the Union and Southern Pacific boards
should the purchase Of the Central Pacific
be- decided on.
I'm any contingency. however. there is
believed TO be little probablity Of such
serious conflict between the government
and the Union Pacific as would lead 10
the appointment OF receiver 10 sell the
stock to the public. The lower court is
authorized to take this step should no
plan FOR disposing OF the stock be pre-
scented or IL II bc rejected by the court
within three months from the time the
decree Of the Supreme Court Is sent to
the lower court for execution.
In view of the Central Pacific's strategic
importance to the Union Pacific system
the question has been raised by those un-
familiar with past railroad history a. to
why the Union Pacific had not purchased
the Central Pacific before. Such move
was not accomplished simply because the
Southern Pacific would not sell the prop
orty. Thereupon Mr. Hartman hougat
control Of the Southern Pacific TO insure
an outlet 10 the Coast The situation to-
day Is as II was at first The Central
Pacific system is the only part of the
Southern Pacific system which the Union
Pacific needs. There is question
whether the Southern Pacific can keep
the Central Pacific these two lines being
competitors I'm much the same sense that
the Union and Southern Pacific are COM
petitOrs.
That being the case. there is good rca-
son why the Southern Pacific should want
10 sell and the Union Pacific To buy. TO
avoid any further litigation by the At
torney General.