Nationalisation
In the years of recession after the Franco-Prussian War of 1870/71 the Ostbahn's economic situation worsened, so that in 1874 a claim was made on the state interest guarantee. As a result the Bavarian state decided to take over the private railway. With a law passed on 15 April 1875 the Ostbahn was bought out on 10 May 1875 and merged with the Royal Bavarian State Railways on 1 January 1876. The Bavarian Eastern Railway at this point had a railway network 905 kilometres long and capital stock of 80 million gulden. To pay for the takeover, the Bavarian state issued bonds totalling around 167 million marks. In addition it took on the company's major debts of around 40 million marks. For each share valued at 200 gulden, shareholders were given this 4% Bavarian state bond worth 400 marks.
Read more about this topic: Bavarian Eastern Railway Company