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- Title
Diversification and Transport Investment.
- Authors
Harbeson, Robert W.
- Abstract
A facet of the current wave of conglomerate mergers which has received relatively little attention is the increasing number of railroads which have organized holding companies for the purpose of diversifying into non-transportation lines of business. The railroad exchanges its shares for those of a holding company and thereby becomes part of a conglomerate enterprise. The extension of conglomerate enterprises into the field of regulated industry has important legal and economic implications over and above the antitrust aspect, which is the source of concern with respect to conglomerate mergers outside the public utility field. It is the purpose of this paper to consider these implications as they relate to the railway industry. A number of railroads have long derived a significant part of their income from non-transportation activities. Several western railroads are involved in oil, mining and timber operations which are an outgrowth of the land grants which they received to help finance construction, while Penn Central receives substantial income from real estate originally acquired by the former New York Central in connection with the Grand Central terminal development.
- Subjects
UNITED States; CONGLOMERATE corporations; TRANSPORTATION; MERGERS &; acquisitions; RAILROAD holding companies; DIVERSIFICATION in industry; RAILROADS; BUSINESS; INCOME
- Publication
Land Economics, 1970, Vol 46, Issue 1, p12
- ISSN
0023-7639
- Publication type
Article
- DOI
10.2307/3145419