Pertaining to all railroading subjects, past and present, in Pennsylvania
3 posts • Page 1 of 1
Suggest you RDG fans get a copy of "Derailed by Bankruptcy". Awesome story of the RDG Co leading up to C-day and after the bk. I didn't know this but CSX owned 51% of RDG stock and the RDG owned 51% of CNJ stock. This was done so CSX could reach the northwest market and compete with the PRR. Really something how the RDG and the fed gov't fought over the value of the railroad related assets for 10 years. The RDG finally got $120,000,000 cash which was required per the 4R act to be used to pay the creditors. The RDG stock was delisted from the stock market, valued at $0.02/share. Four amigos were drunk at a cocktail party and decided to offer CSX a whopping $25,000 which was accepted as CSX was making tons of $ and needed a tax write off so they took a huge loss on the stock. Then those 4 friends appointed themselves to executive positions, took the leftover $ from the feds and started selling the old RDG real estate to make $. Then later they sold the company to lawyer who used the $ to build movie theatres.
When I said CSX I meant Chessie. Most rr folks still refer to CSX as Chessie. The book said Chessie owned 51% of RDG. The 4 friends offered $25k and Chessie agreed. Old newspaper clippings from the era confirm this.