North Staffordshire Railway - Amalgamation Proposals and Financial Strength

Amalgamation Proposals and Financial Strength

There were several proposals made either to the NSR or by it, to merge or lease or sell the company to other railway companies. The first was in 1849 when the LNWR, using its financial strength, made suggestions about a merger. To avoid this the NSR had to agree to the running powers outlined above. A further attempt in 1851 got as far as a parliamentary bill being submitted for amalgamation until the select committee appointed to look at the bill reported against the idea. The LNWR made a further attempt in 1855 which failed because of concerted opposition by the MR, MS&L and GWR. Less than twenty years later, in 1870, these four companies all combined to look at taking over the NSR following a decision by the NSR board to sell or lease the company. The four rival companies were unable to agree on who would take what share of the NSR and the proposal floundered.

In 1875 the MS&L proposed an amalgamation which initially found favour with the NSR board and shareholders but eventually fell through when the MS&L finances were investigated and it was found that the MS&L was no stronger financially than the NSR. Only two years later some NSR shareholders proposed a merger with the MR, the board dismissed the proposal with the chairman reminding shareholders that

The NSR had a small mileage and had to collect traffic for the large companies which surrounded it. They made profits from good mileages while the NSR had to do a great deal for comparatively little return.

The quote about little return was accurate. In 1877 the NSR dividend was only 2% compared with the dividend of 6% paid by the LNWR to its shareholders. A year later the dividend fell to its lowest ever point of only 1⅝%. However it recovered and after 1881 never fell below 3%. In 1891 the NSR paid a 5% dividend for the first time, a level not to be reached again until 1913.

In 1913 the NSR ranked as the eighteenth largest company by route mileage with 216 miles (348 km). Passenger numbers stood at 7,200,000 and goods traffic handled by the NSR consisted of 1,750,000 long tons (1,778,082 t) of goods, nearly 4,000,000 long tons (4,064,188 t) of coal and coke and over 2,000,000 long tons (2,032,094 t) of other minerals. Among the 1,750,000 long tons (1,778,082 t) of goods was 150,000 long tons (152,407 t) of pottery, over five-sixths of the entire production in Britain.