Catasauqua and Fogelsville Railroad merger with Reading

The Wikipedia article for the C&F says that the Reading had gained control over the CF stock in the early 1890s and leased the line but only actually merged it into their company in 1944 after the line south of Lock Ridge (Alburtis for all practical things) had already been abandoned. Why did they wait so long to bring them into the fold?

Hello, Joshua. As I understand it, there are certain benefits versus disadvantages concerning lease of a railroad property versus outright ownership. The Reading Company maintained the lease for reasons which seemed good to them (avoiding certain fees related to a complete transfer, perhaps?). I recall that many leased properties were wholly merged into the Reading Co. in 1945, the C&F being only one small aspect of this en masse change.

Perhaps someone with a more detailed financial background can expand upon this? You may find one or two such persons in this website's Reading Company forum, should you choose to ask your question there.

Thanks for bringing this up; I wrote the original article, and this inspired me to look a little harder for the answer. I found some old NYT articles, and while they didn't say anything about the 1944 mergers, the 1945 mergers were supposed to be to bring about tax savings and to simplify the corporate structure.

The Catasauqua & Fogelsville and the Philadelphia & Reading Terminal Company were merged in on August 10, 1944, while the Allentown RR, Colebrookdale RR, Gettysburg & Harrisburg Ry., North-East Pennsylvania RR, Perkiomen RR, Philadelphia & Chester Valley RR, Pickering Valley RR, Reading & Columbia RR, Stony Creek RR, Philadelphia, Newtown & New York RR, and one other I can't at the moment identify were merged in on December 31, 1945.

Let me know if there are any other deficiencies in the article you'd care to see corrected.

While this may not apply to these specific Reading mergers, one major general reason for leasing companies rather than merging them outright was the cost of buying out minority stockholders. This was true, for example, with the old New York Central System. The Central found it so expensive to merge the Lake Shore & Michigan Southern in 1914 that it kept subsidiaries like the Big Four, Michigan Central, T&OC, etc. corporately separate, then leased them in 1936. In some other cases (e.g., the C&O-B&O affiliation in 1963), the controlling railroad didn't want to assume the bonded debt of its subsidiary.

In the late 19th century, an enterprise of the time produced and sold "bird's-eye views"of many Pennsylvania communities, with local attractions and businesses listed. Alburtis had one of these, and the Catasauqua and Fogelsville is shown as crossing the Reading (East Penn) main line by means of an overpass rather than at grade.

The C&F was originally envisioned as an ore hauler between the furnace at Lock Ridge, south of Alburtis, and iron mines to the north and west of Allentown, extension to Catasauqua (which had a number of anthracite-fired iron furnaces) allowed it to connect directly with the LV and CNJ (Lehigh and Susquehanna) plus lines serving the cement region north of Allentown. Volume of business was sufficient to justify a daily Rutherford - Catasauqua through freight until at least 1964.

The at-grade connection between the two lines was later controlled by a small interlocking tower. The all-time-tower-list Yahoo group shows its constrction date as 1897, and a large photo print of it (around 1910) is on display in the Alburtis Borough Buildiing. Closure came in 1964 when control was transferred to Oley tower in Reading. The foundation is still visible a few yards west of the Main Street crossing