Evening star., 1922-09-02
ADVANTAGES 0F :
ONE MERGER PLAN
Pepco-RaiIway Companies
Union Would Help
Financing.
BY I. A. FLEMING.

The measure passed by the Senate
yesterday, should it become a law,
and there seems to be good chance
that ii Will. should result in speedy
consolidation of the Potomac Electric
Company, and the Washington Rail-
way and Electric Company.
A merger of the two companies
would enable the combined company
to make a splendid showing and be
great aid to financing operations
undertaken by the latter.
Time and again the management
have sought to bring about this
union de facto, but Congress has
stood in the way and the Public
Utility Commission has dealt with
two separate companies.
stock in Escrow.
All the stock of the Potomac Elec-
trio Company. with the exception OF
"A very few shares. is deposited un-
der the mortgage agreement cover
ing the $11 $4,000 Washington Rail
way As. due 1851, and ii had to be
practically the property of the rail
way company TO be so placed.
The Potomac Electric COMPANY.
serving as it does the city of Wash
ington with light and power, as well
as some nearby localities and inter
urban railways, has always been
large moneymaker, while the rail-
way company has seen some lean
days.
The merged corporation would he
able to present financial statement
CT condition that would he vastly
more favorable than anything the
Railway company could show, and
its offerings of securities could lac
fioated at A lower rate than separate
obligations of either company.
Naturitjcs
1t is not likely that the Potomac
Electric Company will be called on
in the near future to pay I per cent
for money. as planned when the !
per cent refunding and improvement
mortgage was prepared. or that
per cent will have to be paid for
loans either.
Maturities referred to by Senator
Ball in his statement Of the Potomac
Electric Company, included $4.69l,0Oo
general SIS due in 1923, SI50.0OO de-
benture 6s due in 1925. and S1.700,000
first mortgage IS due in 1929, a total
of S7,1i1.000. at least partial refund
ing of which will be a matter for
more or less early consideration. and
may be accompanied with but little
trouble in the present condition of the
Investment market.
With these bonds provided for the
Potomac Electric Company. would
be at ease until 1886. at which time
n. 900, 900 consolidated SIS will mature
far enough away to cause no one any
worry at this time.
AS for the Washington Railway
and Electric Company. il has ISSUE
but 81 900, 900 of bonds other than its
first As, the issue being s1.000.O0p
general 6s. which mature next year.
and for which rumor has il til,
money is held waiting
The company however, is hack o.
Metropolitan Railway first 5s. mA
turing in 1925.
As for Railway Merger.
As for a merger between the two
railway companies of the capital. til,
passage by the House and the sigma.
ture of the President of the Ball az
in the Senate would not bring il
whit easier.
1t would repeal the La Follet;.
resolution, preventing one corporate
than 20 per cent of the capital sto"
of another company. the monk,
wrench that the Wisconsin senate
threw into the Washington Utilits,
ICompanyS plans some years ago whc
a real all-utility merger was undo
way.
The two street railway conpanies
if able to agree upon merger pia'
with universal transfers. could haNt
put il across any time within the las
five years. without much trouble. b
their managements are far, far apaTi
in views 10 the value of tn
plants, and have not been able to- gtt
within actual speaking distance
hence no voluntary merger. No one
president, no one general manager.