N&W vis-a-vis C&O

[nw-mailing-list at nwhs.org]

Don't know how it came to be, Abram, but the PRR certainly did have control of the N&W with its 39% of the common stock.  It acquired it in 1901 along with control of the B&O, which it later sold; NYC acquired a hunk of C&O.  These acquisitions were done to try to provide some stability in freight rates for the coal dumped over eastern piers.  After this end was accomplished, PRR sold its B&O interest and, I believe, NYC sold its C&O (which might have been a big mistake).

PRR made three intelligent decisions in its corporate life:  1) to buy 39% of N&W; 2) to hold onto it until the merger movement of the 1960s dictated divestiture, which began in 1964 but was not completed until 1972 (all this is in the N&W annual reports, available on CD thru the Society) and; 3) to not interfere with the corporate affairs of the N&W.  In other words, they let the N&W do its own thing and were content to reap the dividends.

I don't know exactly how much N&W paid PRR in dividends over that period, but I have calculated what 39% of the total common stocks amounted to.  It was $407 million dollars.

I have fun with my PRR friends, telling them that PRR's status as "Standard Railroad of the World" was paid for with N&W dividends.  They don't like hearing that.

N&W never missed a dividend, even during the darkest depths of the Great Depression.

EdKing
  ----- Original Message ----- 
  From: nw-mailing-list at nwhs.org 
  To: N&W Mailing List 
  Sent: Saturday, July 01, 2006 6:09 PM
  Subject: N&W vis-a-vis C&O


  The thought occurred to me today, while reading some C&O history, that the N&W was singularly fortunate to have escaped, throughout its history, the pillage of outside  manipulators, a fate which definitely befell the C&O.

  The C&O was controlled, at various times, by C.P. Huntington (late 1860s,) Morgan and Vanderbilt (1888,) the Van Sweringens (1903) and Robert R. Young's interests (late 1940s.)

  By contrast, the only big railroading player to have invested heavily in the N&W appears to have been the PRR in the 1920s, and the PRR was not allowed to attain a "controlling interest."  Indeed, the PRR's investment seems to have been for cash-cow purposes, not for purposes of integrating the company or directing its commercial affairs.

  Two similar and proximate railroads, two completely diverse histories in this respect.

  Has anyone thought about how all this "came to be" ?

  -- abram burnett


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