New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1914-05-09
MO. PACIFIC FAILS
TO GET new LOAN
Kuhn, Loeb & Co. Decline
to Finance Roads
Maturing Notes.
OFFER OF EXCHANGE
LIKELY TO BE MADE
Gould Still Shows No Sign Of
Yielding Control of the
Company.

Missouri Pacifc's fate still hangs In tho
balance. The uncertainty surrounding
plans for meeting tho company's s25,0oo.-
900 issue OF per cent notes. maturing
juno I. was further enhanced yesterday
in An announcement by Kuhn. Loeb & Co.
that they had rejected the offer OF George
J. Gould and his associates to take over
the financing OF this pressing obligation.
Tho decision was reached by the bank
ing Arm following an examination Of q
report on the property's condition made
by John It. Stevens, tho engineer. A let
tar setting forth in detail their refusal to
und erwrite the June notes has been sent
10 the Missouri Pacific by the bankers.
This communication will be made public
on Monday.
AS it was understood that Mr.. stevens's
report on the physical condition OF the
railroad was favorable. 1t was concluded
that the real reason behind the bankers
refusal to participate in the financing OF
the notes about to mature was the faiiure
to reach an agreement with George Gouid
for his retirement from active manage
ment in Missouri Pacific AFFAIRS. This, IL
was believed, was demanded by tho
bankers, although their letter may NOT
mention such a provision.
Missouri Pacific directors held a two
hour session yesterday in tho company's
offices at 1S5 Broadway. but no announce
ment was made concerning either tho re-
lection of the company's proposal TO tho
bankers or any other plan for meeting
the June notes. The only Information
given out was that the meeting had ad-
tourned until to-day, when the June ma
turity would again be discussed.
While the question Of a receiVership LOT
tho Missouri Pacific now looms UP moro
Overwhelmingly, bankers and railway men
fac, that some way will be found to toe
the company over the present Crisis a
receivership at this time. they said' wouiu
not only prove disastrous for the ROAD >
own security holders. but would make IL
more difficult for carriers enjoying greater
nrosperity to finance their requirements.
With expected resumption OF banking
r.,ot,ons between the Missouri Pacific and
Kuhn. Loeb g. Co. now having como 10
Nothing the directors OF tho roao sun
have recourse to the plan under CONSIDER
alton before the entrance OF these bankers
into the negotiations for financing tho
luna notes of a new issue OF two-year
n.r cent notes to be underwritten ana
offered to present noteholders In exchange
for their old notes. Tho inducemeht 10
make this exchange included cash bonus
Of per cent Of the par value OF the notes
exchanged.
II Is understood that the Gould family
holds about s., 10000 OF the maturing
notes and that the holdings OF John d.
Rockefeller aggregate about half that
amount.
Another plan, which is said to be
favored by George Gould. IL the sale OF
part Of the collateral behind the s2.oO'ooo
rotes. which includes S19.5oooO ST. LOUIS
Iron Mountain & Southern first and re-
funding 6 per cent bonds. The proceeds II
was said, could be applied toward pay
ment OF the notes. and II more money
were needed Il might be obtained through
the sale of additional bonds OF the Iron
Mountain line issuable under its new $780,
600 900 refundng mortgage created last
July.
The great difficulty in putting through
any Of these plans It was said YESTERDAY
would be TO get bankers to underwrite
Missouri Pacific securities so long as
George J. Gould dominates the roads
MANAGEMENT Since the withdrawal OF
Kuhn, Loeb & Co.. three years ago. from
banking connection with the road Speyer
& Co. have underwritten Its securities.
Tho fact that financial proposition has
been made and rejected by the bankers at
81 William st. may be determining rae
tor In influencing the Pine st. banking
house from coming to the rescue at this
late stage of the game. Should this prove
TO be true the Missouri Pacific's ability to
meet tho June notes seems to rest entirely
on the shoulders OF George Gould and
other members of the Gould family.