Edgar Speyer - Life To 1914 - Financier

Financier

In 1884, Speyer became a partner in each of his father's businesses. He headed the Frankfurt office before taking control of the London office, Speyer Brothers, in 1887. His older brother, James, headed the New York company. The firm specialised in arbitrage with Europe and the United States, and the financing of railway projects. On 29 February 1892, Speyer became a naturalised British citizen.

Speyer Brothers' involvement in railway finance brought Speyer into contact with American Charles Yerkes in 1900. In Chicago, Yerkes had led the development of the city's urban transport system, and he went to London to capitalise on the emerging opportunities for new deep-level underground "tube" railways there. He and Speyer headed a consortium of international investors involved in the construction of three of London's underground railways and the electrification of a fourth.

With Yerkes as chairman, the Underground Electric Railways Company of London (UERL) was established in 1902 with a capitalisation of £5 million, the majority of shares sold to overseas investors. Further share issues followed, which, by 1903, raised a total of £18 million (£1.43 billion today) to be used across all of the UERL's projects. Yerkes died in December 1905, and Speyer took his place as chairman of the UERL. By 1907, the three new railways had opened and the electrification works had been completed. Despite the UERL's engineering success in carrying out the works in such a short time, the company was in a difficult financial position. The preliminary estimates of passenger numbers proved to be over-optimistic and revenues were not covering operating costs. After bailing out the company, Speyer, with Managing Director Albert Stanley, struggled for a number of years to restore its finances. This was finally achieved with the purchase of the London General Omnibus Company in 1912, as its profits could be used to offset losses elsewhere in the group. In November 1912, Speyer further consolidated the UERL's control of London's underground railways when he negotiated the purchase of London's two other main tube railways, the City and South London Railway and the Central London Railway.