[Newspaper]
Publication: The Kentucky Post
Covington, KY, United States
no. 3163, p. 1, col. 1-5
GIGANTIC GAS CONSOLIDATION
North American Company and the Standard Oil Company to Operate Light
Companies of Three Cities.
Deal Whereby Shinkle Sells the Covington Gas Company and
the Newport Light Company to the Combine.
Electric Light Companies Are Included in the
Consolidation — Effort Being Made to
Get Control of the Cincinnati
Gas Company.
As exclusively published in the Kentucky Post Monday, the Covington Gas Company and the Newport Light Company have been sold to Eastern capitalists, who will try to control the lighting interests of Covington, Newport and Cincinnati.
A gigantic deal for the consolidation of the electric and gas light companies of Covington and over the river cities and towns and for the transfer of the Cincinnati street railway lines to the Elkins-Whitney syndicate is on. Though the two deals are said by those interested to be entirely separate, Standard Oil money is behind both of them, and it is the supposition that the carrying out of the plans now underway will lead up to an enormous consolidation of interests, for which millions will be paid.
North American Company.
The North American Company, owning a great share in the Cincinnati Edison Company, is back of the deal that looks to a combine of all the lighting interests of Covington and the cities across the river. This company backed the Dieterich syndicate in its attempt to get a fuel gas franchise in Cincinnati.
It has been fighting the Cincinnati Gas Company all the time, and was back of the recent purchase of the Suburban Electric Company, of Covington.
Now it is said negotiations are almost concluded for the Cincinnati and Covington Gas Companies.
Alexander McDonald's presence at the time of the suburban sale led to the rumor that Standard Oil interests were back of the gas deal.
Now it is said he only represented Charles Shaw. The Covington Gas Company has the Covington light franchise.
Engineered by Foraker.
Senator Foraker engineered both deals, and Charles E. Prior, who assisted him, returned from New York Tuesday morning.
Only a franchise.
The Newport Light Company included in the lighting deal, is owned by the Covington Gas Company, which bought it of the Cincinnati Gas Company a year ago.
It has no plant and is chief value lies in its municipal franchise, expiring in 1907.
Street Railway Changes.
From a reliable source it is learned that the deal for the purchase of the Cincinnati Street Railway lines by the Whitney-Elkins syndicate is practically completed, and all parties interested expect that it will soon be consummated.
Matters have gone so far that plans for the future have already been outlined by the prospective new owners. It is said that they will introduce a new and more liberal transfer system, make many changes and make the system the finest in the world. A reduction in fare is also contemplated.
Ex Mayor Rhinock, of Covington, who engineered the gas deal, said positively that the lighting combination had absolutely nothing to do with the rumored sale of the Consolidated Street Railway Company.
Rhinock declines the presidency of the new light company.
Fourteen months ago the Covington Council advertised for bids for the 20 year gas franchise. Bids are received from A. K. Detwiler, of Toledo, O., and the Covington Gas Company. Detwiler bid 95 cents for illuminating gas, 70 cents for fuel gas, and 50 cents to manufacturers, and 3 per cent of the gross seats to the city. The Covington Gas Company bid $1 for illuminating gas, 90 cents for fuel, no reduction to manufacturers, and no revenue to the city. Lobbyists for both bidders made desperate efforts to get the Covington Council and Alderman to award a franchise. Frequent charges of fraud and bribery were made. The Council finally passed the Detwiler bid, which was obviously the better for the consumer. In the Alderman the vote was 2 to 2.
Bidders Combined.
The fight was then taken into local courts and finally to the Court of Appeals. In November the Alderman suddenly awarded the franchise to the Covington Gas Company. It was then stated that the gas company and Detwiler had combined, as they saw no chance of either company getting a bid through both boards.
It was rumored then that the Standard Oil Company had bought Shinkle out, and as soon as the bid passed both boards, he would receive $750,000 for his company. The deal was engineered by Ex-Mayor Joseph L. Rhinock and Charles Shaw, of Richards, Stallo and Shaw. Mr. Stallo is a son-in-law of Alex. McDonald, of the Standard Oil Company, and there is no question but what that corporation, together with the North American Company, will control lighting and interests of the three cities.
Mr. Shaw is receiver and a heavy stockholder in the Suburban Electric Company, of Covington, which is included in the deal. Mr. Shaw will receive $150,000 cash for his interest in the Suburban.
The gas franchise matter is up to mayor W. A. Johnson, of Covington, having passed both boards. It is believed he will sign the ordinance, and that it will be done Wednesday, at the meeting of the Board of Alderman. This will give the franchise to the Covington gas company f