New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1913-02-07
Directors Work Out Details of
Mandatory Separation A.
ter Weeks of Con- /
ferenCeS.
AS RECENTLY ANNOUNCED
Kuhn, Loeb g. Co. Likely to
Head Underwriting Syndi.
cate-Cali. ornian Oppo.
sition Probably Not
lnsurmountable.
CAPTAIN JAMES L. HUSsEY.

After conferences lasting since the
middle Of December. when the first
plan for the separation of the Union
and Southern Pacific railroads vas re-
jected by Attorney General Wicker
sham. the directors OF the two systems
finally reached an agreement yester-
day.
As IL still must meet with the formal
approval OF the Department Of Justice,
IL cannot be positively asserted that the
plan in its present form will be ulti-
mately adopted Moreover, il has
further TO be sanctioned by the district
court In which the litigation is pend
ing. and also by the California Railroad
Commission.
The California commission may raise
some objections. as sentiment there is
reported 10 be opposed TO the transfer
Of the Central Pacific 10 the Union Pa
cihc. The history Of tpe State of Call
fornia is closely connected with the
growth Of the Central Pacific. and il is
believed that any change in the present
ownership will not be looked upon with
favor.
In the main the plan is practically
the same as outlined previously by The
Tribune. II provides
That the ,l2ssS0op Southern Pacific
Il T..fl
fered TO the stockholders Of both COM
p5nles at par.
southern Pacific stockholders TO be
entitled TO one share Of Southern Pa
cihc stock for every three shares now
held.
Union Pacific stockholders to be en-
titled 10 one share of Southern Pacific
stock for every four shares OF Union
Pacific stock now held. the preferred
stock 20 share equally with the COM
mon.
From the sale OF stock sSi.675ooO.
less underwriting commission and ex-
penses. 10 be- paid over 20 tho South
ern Pacific. together with s.. 49, 90 OF
the Southern Pacitic's per cent bonds
and N+cJj.lil IN cash.
The sum total OF these payments Is
SIC4. 1891. or the amount that Is To
he paid over for the ownership OF the
Central Pacific.
Here is the detailed statement made
yesterday by both companies:
The boards OF directors of the Union
Pacific Railroad Company and the South
ern Pacific Company, at meetings held to-
day. approved plans which have been
under consideration by special committees
for several weeks and which have been
worked out with the Attorney General.
sn1 g.s
follows
How Plan Was Changed.
The purchase by the Union Pacific OF
the entire capital stock OF the Central
pacific consisting OF t67 Us. 500 mar value
ferred. for the sum OF sl0i.ls9 9il-the cost
at which IL stands upon the books OF the
Southern Pacific Company. OF the
amount tst675.50o was 10 have been paid
I'm 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 made as follows. viz:
The. entire amount Of stock OF the
Southern Pacific Company held by Union
Pacific--sl266j0.00O par value-is TO be OF.
fered to the stockholders. common and
preferred. OF the Union Pacific, and stock
holders OF the Southern Pacific Company,
other than the Union Pacific and oregon
cent and accrued dividend
This offer Is TO be underwritten and
subscribers are to receive the dividend
payable April /. 1918. The proceeds OF
Isl i.6I5,500 OF this stock, less the under
writing commission and expenses. are TO
be paid over TO the Southern Pacific Com
pany. together with s5.i49.0o0 OF the
Southern Pacific Company's per cent
gold bonds and s14.065. al in cash.
The Attorney General OF the United
States has assented TO the essential feat
ures of this plan. but IL is, OF course. sub
ject TO the approval of the district court
i'm which the government litigation is
pending. and also dependent upon the ap-
proval by the California Railroad COM
mission of agreements Tor certain trdcN-
nlan and agreements will be presented 10
the court and commission with the least
possible delay.
Although it Is not so stated in the
above explanation. Wall Street Is con-
n..s;...l third uaUe fhivd coluuu