Consolidation of the El Paso and Juarez Street Railways
When the Santa Fe, Mexican Central, Texas & Pacific, and Sunset Routes were completed to El Paso, about 1880, the five thousand people of El Paso, and eight thousand of Juarez, organized four street railways, two in El Paso (one on El Paso Street and one on Santa Fe Street), connecting with the two similar Mexican roads on the Juarez side at the middle of the Stanton and Juarez Street bridges. Stock in these roads was subscribed in the East, but each road had a president, four directors and other officers, all of whom, to be popular with the public, made deadheads of the officials of the two cities, policemen, collectors of customs, revenue officers, and so forth. There was, therefore, great maintenance expense and little revenue for the stockholders, and the equipment soon degenerated into a most impoverished condition. When it became necessary to assess stockholders or go into bankruptcy, Senator Bate, from Tennessee, a personal friend, complained to me that he and his wife had twenty-five thousand dollars in stock of the El Paso street road. He was unable to pay his assessments and, as El Paso was said to be my town, he thought I ought to do something to relieve him. We went to El Paso and he had some stormy interviews with the managers of his road. Suggesting the possibility of a consolidation of the four roads, I told him that as I had the confidence of the Mexicans as well as the Americans of the two cities, if he was willing to come with me, we might encourage the stockholders in New York to give proxies for a majority of the stock.
We saw the principal stockholders in New York, one of them a cousin of J. P. Morgan, obtained proxies for a majority of the stock and power of attorney to represent the stockholders in the consolidation of the four roads.
The El Paso street road was advertised for sale under foreclosure. Authorized by its stockholders to purchase, I did so, and then obtained from the Mexican stockholders and others in El Paso proxies for a majority of the stock in the other roads. Calling a meeting of each of the four roads, I proposed a consolidation into one company, making the circuit through both cities, to be styled the El Paso and Juarez Traction Company, with charters from the States of Texas and Chihuahua. Governor Ahumanda of Chihuahua and the Governor of Texas both granted the charters. The four companies made a statement of their financial condition and expressed willingness to merge in the new international company. It had a capital of two hundred thousand dollars, distributed to each company in proportion to their annual gains for the past five years. The directors of the four companies elected officers for the new company. Messrs. Z. T. White, Jos. Magoffin, John A. Happer, Max Weber and I were elected directors, and by them I was elected president. There was some disagreement as to the stock to be allotted the Santa Fe Street Company, and the officers to be elected, so Messrs. White, Maxon and Gordon declined to enter the consolidation. It was agreed to run the roads jointly, but the Santa Fe company kept its own organization. The four companies were run under our management as one road, all deadheads were cancelled and the company soon prospered.
At this time Stone and Webster of Boston offered to buy the company at its stock valuation, two hundred thousand dollars, and, after some delay in correspondence, the sale was accomplished. The new company at once put in an electric system and it has since grown to be one of the best car companies in the United States, well managed, with two million dollars capital, and some sixty miles of road.
It can be justly claimed, I think, that this was a most material development for the cities of El Paso and Juarez. Too much credit can not be given those who joined me in the project, Messrs. Magoffin, Happer, Weber, and others. Printed proceedings of this consolidation may be found in the El Paso Library.