The sun. [volume] (New York [N.Y.]) 1833-1916, 1915-08-18
MISSOURIPACIFIC IN ,
RECEIVERS HANDS
Chairman Bush Put in Control
Of Line and Also Iron
Mountain.
HOPE FOR WAY OUT SOON

Louis, Iron Mountain and Southern rail-
ways were put In the hands OF b. r.
Bush. chairman Of the boards of the
companies. as sole receiver yesterday by
Judge Adams of the United States Dis
trict Cour Of st. Louis. Judge Adams
was at Woodstock. VT. when he APP
pointed the receiver. The order places
more tha 1000 miles OF railroad. capi-
TALKED at 1855, 000, 900. under the con-
troll Of the court.
The announcement of the appointment
of the receiver put an effort 10 reorgan-
lie the railway system. said to be the
p~otentiality OF n Of the greatest In the
West. without foreclosure of any OF Its
obligations. As the attempt met with
small respons from the security holders
the receivership is said to be the result
OF the u~nwillingness of the holders OF
stock n bonds 10 accept a voluntary
readjustment Of the financial condition
of the company along lines of general
compromise.
How long the system will remain In
receivership directors refused yesterday
to prophesy. 1t was said in the financial
district, however, that the Missouri
Pacific system had much better pros
pect OF a speedy release from receiver
ship than probably any other road that
had fallen into the hands of a receiver In
recent years.
REORGANIZATION Plan Ready.
one cause OF hope is the fact that
a reorganization plan has already been
drawn up. The Frisco and the Rock
Island, the two other great systems that
have recently broker down financially,
were rushed Into receivership without
warning. 1t is also said THAT the physical
condition OF the Missouri Pacific Is prob
ably far better than that of most OF the
big lines when they went into the con-
troll Of the courts.
The receivership was admitted to be
the only way, outside of "A voluntary re-
organization. to rebuild the financial
structure OF the road. Application for
the receivership was made by the Com
monwealth Steel Company, which has
an unpaid claim OF $780, 900 against the
Missouri Pacific and another of $50. 900
against the Iron Mountain. The appoint
ment OF Mr.. Bush was agreed to by both
sides in the suit. The action followed a
special meeting Of the board Of directors
on Monday.
Wall Street looked for a receivership
sooner or later. IL came somewhat sooner
than was expected. The voluntary plan
OF reorganization proposed by Kuhn.
Loeb & Co. on July l was recognized as
a real attempt To accomplish an almost
impossible task by frank dealing with
the security holders. II turned out that
there we're too many interests to recon
cile without the assistance of the court.
II Is believed, however. that the plan
proposed will be carried out in It's essen
tial details through the receivership.
Only One Gould Line solvent.
With Missouri Pacific in receivership
only one part of the once great Gould
system that reached almost across the
Continent remains solvent. That is the
Denver and Rio Grande. The lines that
met trouble are the Wheeling and AXE
Erie. the Wabash. the Wabash-Pitts-
burg Terminal, the Western Pacific and
the Western Maryland. now out of re-
ownership. Nearly 10000 miles of
Gould railroad have been In receiver
ship. The total of railroad mileage
row in receivership is brought up to
nearly 10000 miles by the Missouri
Pacific.
The readjustment managers and the
stock and bondholders committees in
n statement yesterday said
1T is fortunate that through the Sc
lection of MIR. Bush continuity Of ef-
hcient management is secured. The
recelNership only emphasizes the impor-
lance of the prompt cooperation OF the
security holders in carrying through the
plan of reimbursement. The plan Is be-
lieved to be fair and Just to all inter-
ests and the reduction of fixed charges
Is considered essential to place the prop
erty upon a sound financial basis. De-
faults in the pay ment OF interest upon
several of the mortga ges and fore
closures ere unavoidable, but II is hoped
that the period OF receivership will be
or short duration and that the delay
and expense Incident to receivership
will be reduced to "A minimum by the
prompt deposit of securities. The time
for deposits has been extended to Oc-
tober 15."
The plan contemplates. through an as
sessnent OF $50 a share on the stock, the
raising Of $41.4l9,792. Largely through
the exchange OF the 4 and the 8 per cent,
bonds for new preferred stock. the fixed
interest bearing securities OF the system
will be cut down by s6O,552.55s.
Suits were filed In the United States
District Court here yesterday asking for
the appointment OF an ancillary received
in this district for '.le Missouri Pacific
Railway Company and Its subsidiary.
the ST. Louis, Iron Mountain and South
ern Railway Company. The complain
ant In both actions is the Commonwealth
Steel Company.
STRONG WORKS IN PROTEST