Wednesday, May 11, 2011

Mobile & Ohio Railroad Stock Memoranda of Sale

Below are memoranda of sale for the stock of the Mobile & Ohio Railroad cancelled by six different brokers.  The 1898 tax period was an interesting one for the stock of the Mobile & Ohio.  In late 1898 the stock was trading in the low 30s, by mid 99 and into 1900 the low 40s, but then by early 1901 the shares rocketed to around $70 per share.  The memoranda below are in chronological order starting in 1898 and then running through early 1901. 

The history of the M&O indicates why the railroad's stock might have experienced a price spike by February 1901.  According to a history of The Mobile and Ohio Railroad in a book by James Lemly::

...the board of directors of the M&O recommended that stockholders and bondholders of the M&O accept a security exchange plan which was offered by the Southern Railway on January 31, 1901. The Southern wanted the north-south line of the M&O and was in a position to provide financial assistance which the M&O needed to remain in competition with its richer rivals. Under its plan, the Southern acquired control of the M&O when the holders of 48,748 shares out of 53,206 shares outstanding exchanged their stock for 4 per cent Southern stock trust certificates. At the same time the holders of a majority of the M&O general mortgage bonds exchanged their securities for Southern collateral trust gold bonds for the same amount, principal and interest, payable on the same dates and secured by the M&O general mortgage bonds.

100 shares @ $31 7/8
December 30, 1898
Ladenburg Thalman

$2 in tax stamps

300 shares @ $42
April 10, 1899
Harris & Fuller

$6 in tax stamps

100 shares @ $40 1/2
May 15, 1990
Rolston & Bass

$2 dollars in tax stamps

200 shares @ $40 1/4
May 15, 1990
S. F. Johnson

$2 dollars in stamps on front, and an additional $2 on back

100 shares @ $69
February 1, 1901
I. S. Wormser

$2 in tax stamps

100 shares @ $70 1/2
February 1, 1901
W. S. Lawson & Co.

$2 in tax stamps


Back to the story of the Mobile & Ohio Railroad.  James Lemly's book says this about the Mobile & Ohio's origins:

The Mobile Road, as it was often called in its early days, was planned by the people of Mobile to serve the city, in the same manner that the Mississippi River had served New Orleans. The railroad was expected to bring the trade of the upper Mississippi, the Missouri, and the Ohio River basins to Mobile. The project was named the Mobile and Ohio Railroad, because it was to connect that city with the great river systems which converged near Cairo, Illinois, and thus the port of Mobile was to assume a much greater role in commercial affairs at the expense of New Orleans.

The Mobile & Ohio ran south-north in a corridor dominated by two other major railroads, the Illinois Central and Louisville & Nashville.  Eventually it would shake loose from its relationship with the Southern Railway, reported at the top of this post.  The M&O would then join up with the Gulf, Mobile & Northern and form the Gulf, Mobile & Ohio, with lines running from the Gulf of Mexico to Chicago.  The GM&O would be known as "The Rebel Route."  By 1972 the line was merged with the Illinois Central and ceased to exist.

1902 Mobile & Ohio route map

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