The Washington times., 1914-03-08
THE GAS MERGED.

reported from the Senate Appropri
ations Committee, contains a pro-
vision authorizing the Washington
Gas Company to buy, if necessary
by condemnation, all the stock OF
the Georgetown Gas Company which
is not already owned by the Wash.
:ngton company, and to merge the
Georgetown company;S property and
corporate existence with those Of
the Washington company.
This is a somewhat remarkable
provision, which seems, in the inter
est of the District S public, to re-
quire very careful examination; and
The Times takes the liberty to ask
that some Of the Senate's lawyers
give the measure careful eyamina-
. tion and airing when it comes up
for consideration. This provision,
The Times is informed, did not orig
mate with the Public Utilities COM
mission, and has not had the affirma-
tive approval of that body. 1t does
have the approval and Jealous sup
port of the Washington Gas inter-
ests, and the desirability o. its en-
actment is very gravely questioned
by the official representatives of the
public interest in the transaction.
In order that this situation may
be understood, it is necessary to re-
cite in some detail the facts con-
cerning the relations of the two gas
companies. The Georgetown COM
pany has COCO shares of capital
stock, cf the par value of s25; total
nominal capitalization, $4,000. OF
these 5000 shares, $3.50 arc already
owned by the Washington Gas Com
pany in its treasury, having been
bought a number of years ago. On
these $3.50 shares thus held by it's
rival corporation, the Georgetown
company has for lorg time refused
to pay any dividends, alleging that
this holding by the Washington
company was ultra wires Of that cor
poration. Formerly, the Georgetown
company was dominated by and op-
Grated as a sort of subsidiary of the
Washington company. But in more
recent time the Georgetown COM
pany has been in control os interests
adverse TO the Washington COM
pany. The latter, having a large
investment in Georgetown shares on
which it was refused dividends, nat
urally had double interest in de-
string to gain control OF tha George
town: it wanted it's dividends, and
it wanted to perfect its control Of
The local gas situation.
Recently there has been report in
local business circles that directors
Of the Washington company have,
in their Individual capacities, bought
up 2 controlling part of the 2,470
outstanding shares Of the George
town company, so that they are
now in position To dominate that
corporation without reference to the
snares held by the Washington com
pany in its corporate capacity. As
explained to The Times today by
presiGe!:: Rceside, Of the Washing-
ton company, the facts are that a
director Of the Washington company
has, in his individual capacity, taken
an option of outstanding stock, and
made deposit OF his o'vn money:
this option providing that if the
merger measure shall pass, the s.nci;
shall then be taken ct S-55 per share.
and turned over to the Washington
company. Il is explained that this
option was taken by az individual,
rather than by the Washington COM
plny, because Of the proba5le il
Legality that would attach to the
creation CT such all i.:e-est directly /
held by the Washington cor:pany.
IL, then, the Senate provision fer
merger shall become law, j. is TO be :
presumed that this option will be 1.
exercised; the stock will lie tai:cn
over at $l55, turned over to the
Washington company, and dealt with
as provided by the measure now be- A.,
fore the Senate. President Rcesi /;
assures The Times that TO director
or anybody else connected with the !
Wa Shirotnn copTIn1y will ,o.La g, |