New-York tribune., 1921-12-15
IN. Y. Central Offers
Own Shares on 4-5
Basis for big Four"
Would Exchange Preferred
Evenly; Other Proposed
Changes, if l. C. C. Gives
Approval, Are Announced

The New York Central, after a meet
ing Of the directors yesterday, an
nounccd that an offer had been author
lied to purchase the rtock Of the Clcvc-
land, Cincinnati, hicago g. st. Louis
through an exchange of stock Of the
two companies. For every 100 shares
Of "Big Four" common the New York
Central will offer eighty shares Of Its
own stock, and for each share Of "Big
Four" preferred 1t will offer one share
Of New York Central. Both offers are
subject to the approval Of the Inter
state Commerce Commission under the
provision of the transportation act
relating TO railroad mergers.
Under the present relationship be-
tween the New York Central and the
"Big Four" the former owns $30,207,-
common stock. but none of the $685.
900 preferred which has been issued.
The plan contemplates the complete
absorption Of the controlled property
and the elimination Of its share capt.
talization.
The change, it Is believed, will work
out to the benefit OF the New York
Central because of the improved finan-
cial position of the "Big Four" in the
past few years. Dividends at the rate
of per cent annually have been paid
on the latter's preferred stock since
1910, but the road has earned from s
to IA per cent on the issue In recent
years.
An offer for the stock and income
bonds Of the Peoria & Eastern Railway
is also to be made by the New York
Central on the following basis:
Eastern one $1,000 Az per cent first
mortgage bond Of the Evansville Mount
Carmel & Northern Railway, due in
1860, and guaranteed by the "Big
Four" will be given.
For each $1,000 Peoria & Eastern a
per cent income bonds, one $1,000
Evansville, Mount armel & Northern
will be exchanged. These offers, it was
announced, are likewise subject to the
approval of the Interstate Commerce
Commission.
The Peoria & Eastern is now con-
trolled by the Cleveland, Chicago, Gin
cinnati & St. Louis, which owns q
majority of the stock. All the $500,00O
SCOck OF Cne Evansville, MJ. CaIInel u
Northern is owned by the "Big Four"
The Az per cent first mortgage bonds
consist Of an issue of S2,118,000, all
of which are owned by the "Big Four"
A. H. Harris, vice-president of the
New York Central in charge of finances,
also announced that action was taken
yesterday authorizing the lease of the
Toledo & Ohio Central, including with
it the GAINESVILLE & Western. the Kama
wha & Michigan and the Kanawha &
West Virginia, to the New York Cen
trail for fixed rental and, in addition,
an amount equal to the net earnings Of
the Toledo & Ohio Central for 1921.
But in the case of the Kanawha g.
Michigan the rental is equivalent to
6 per cent on the company's stock.
"The making Of the leases" said Mr..
Harris, ais subject to the approval OF
the Interstate Commerce Commission,
for which application is about to be
made. The New York Central controls
all Of the stock lessor companies ex-
cept a few shares Of the stock Of the
Kanawha & Michigan"
New York Central directors at their
meeting yesterday declared the regu-
lar quarterly dividend of ~ per cent
on the capital stock. The Michigan
Central declared dividend of per
cent, making 6 per cent for the year.
For several years past the rate has
been a per cent annually.