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Norfolk and Western Railway | Henry County, Martinsville, & Patrick County, VA
In the early 1870s, the AM&O operated profitably for several years but, as did many other railroads, ran into financial problems during the Financial Panic of 1873. Mahone retained control for several more years before his relationship with English and Scottish bondholders soured in 1876, and other receivers were appointed to oversee his work. After several more years of operating under receiverships, Mahone's role as a railroad builder ended in 1881 when northern financial interests took control.
At the foreclosure auction, the AM&O was purchased by E.W. Clark and Co., a private banking firm in Philadelphia (with ties to the large Pennsylvania Railroad) which controlled the Shenandoah Valley Railroad then under construction up the valley from the Potomac River and seeking a southern connection. The AM&O was renamed Norfolk and Western, perhaps taken from a 1850s charter application filed by citizens of Norfolk, VA. Although his leadership of the railroad was over, Mahone was active in Virginia politics and a leader of the Readjuster Party. He was thus able to arrange for a portion of the state's proceeds of the AM&O sale to go for community purposes near his home at Petersburg, including the funds to begin what is now Virginia State University (VSU), as well as a nearby mental health facility which is now Central State Hospital. Mahone helped arrange the election of William E. Cameron of Petersburg as governor of Virginia, and was later elected himself to a term as a Senator in the U.S. Congress. He suffered a massive stroke in Washington, D.C. in 1895 and died shortly thereafter. Otelia lived on in Petersburg until her death in 1911.

George F. Tyler was named to head the new N&W when it was organized in May, 1881. Frederick J. Kimball, a civil engineer and partner in the Clark firm was named First Vice President. Henry Fink, who Mahone had hired in 1855, became Second Vice President and General Superintendent. For the junction for the Shenandoah Valley Railroad and the Norfolk & Western, Kimball and his board of directors selected a small Virginia village called Big Lick, on the Roanoke River. The small town was later renamed Roanoke, VA. Next | Back

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