North British Railway

The company's headquarters were at 23 Waterloo Place, Edinburgh and its works at Cowlairs, Glasgow. Its capital in 1921 was £67 million. Besides its railway, the company also operated Clyde steamers on the River Clyde and Firth of Clyde, serving Arran and points west. The company also acquired a 49% stake in the road haulage firm Mutter Howey.

The North British Hotel at the east end of Princes Street in Edinburgh city centre forms a prominent landmark with its high tower displaying large clocks. It was renamed the Balmoral Hotel in the 1980s, though the old name is still shown in the stonework.

In Glasgow, the former Queen's Hotel sited in George Square next to Queen Street Station was renovated in 1905 to become the company's North British Station Hotel, with the attic converted into a fourth storey under a mansard roof. Following nationalisation it came under British Transport Hotels until 1984 when British Rail sold the hotel, which by then was called the Copthorne Hotel. It was later renamed the Millennium Hotel.

A takeover offer from George Hudson

The English railway entrepreneur George Hudson was expanding his portfolio of railways and in 1847 his York and Newcastle Railway and the Newcastle and Berwick Railway were close to completing the English portion of a route from London to Edinburgh. Hudson made an offer to purchase the North British Railway (through the medium of his own companies) for 8% on the NBR capital. Hudson's offer placed a high value on the NBR, but it was rejected by the North British Railway shareholders on the advice of their chairman.

Acquisitions again

Due to Hodgson's improved management in the period to 1862, the financial position was greatly improved. Dividends on ordinary shares up to 3% became regular.

Geographical expansion was limited to funding the parliamentary deposits of prospective friendly branch line companies, with provisional agreements to work their lines. Some changes to the Dalkeith line connections around Edinburgh were made, including feeding the Leith line and the Musselburgh line directly from the main line at Portobello and Wanton Walls respectively.

From July 1861, the Peebles Railway line was leased. In 1862, a greater prize was acquired: the Edinburgh and Northern Railway had expanded from its origins and now, as the Edinburgh, Perth and Dundee Railway (EP&DR), it connected the places in its title, albeit with a ferry crossing of the Firth of Forth and the Firth of Tay. The EP&DR also had a branch from Stirling to Dunfermline, through highly productive coalfields, and it had already absorbed the Fife and Kinross Railway and the Kinross-shire Railway. In the same year the North British absorbed the West of Fife Railway and Harbour Company, giving further access to mineral-bearing areas and to Charlestown Harbour. The acquisition of both companies was authorised by the North British, Edinburgh, Perth and Dundee and West of Fife Railways Amalgamation Act 1862 (25 & 26 Vict. c. clxxxix).

1864 to 1866: a buoyant start, then disaster

Since the full opening of the Border Union Railway, passenger trains had terminated at the Canal station of the Port Carlisle Railway. By 1864 the line was double track throughout and from 1 July 1864 the passenger trains were diverted over the Caledonian Railway connecting line, to terminate in Citadel station. The financial position was somewhat better and a 2% dividend on ordinary shares was announced in August. There was more excitement to come: the Edinburgh and Glasgow Railway had for years seemed to be on the point of joining in with the Caledonian Railway, but now it seemed that it, together with the Monkland Railways, would join the NBR. The Edinburgh and Glasgow had a considerable system, including the Stirling to Dunfermline line and the Bathgate and Morningside line; moreover it was working the Glasgow, Dumbarton and Helensburgh Railway. The Monkland Railways had been formed in 1848 by the merging of several of the old "coal railways" operating around Airdrie and Coatbridge. Their main business was still mineral traffic, and although their operating costs were high, they made a comfortable profit.

On 4 July 1865 the Edinburgh and Glasgow and Monkland Railways Amalgamation Act 1865 (28 & 29 Vict. c. ccxvii) was passed authorising the merger, which took place on 31 July between the Edinburgh and Glasgow Railway and the Monkland Railways, and the following day the merged company was absorbed by the North British. Although some commentators had expected that the E&GR might have absorbed the NBR, the reality was that the new board consisted of 13 former NBR directors and two E&G men. The NBR habitually ran trains on Sundays and started doing so on the E&GR main line, which had not. This ignited fresh protests from Sabbatarians but the NBR stuck to its position on the matter.

As well as the railways mentioned, the merger gave the North British a share of the City of Glasgow Union Railway which was then under construction. When complete, that line would give the North British access shipping berths on the Clyde at General Terminus over the General Terminus and Glasgow Harbour Railway.

The NBR grew to have, by the summer of 1865, about 450 mi (720 km) of route, almost equally divided between double- and single-track. In addition it was working another 40 mi (64 km) of single track for independent companies.

In 1866, comparison with the Caledonian Railway showed that company to be in better shape:

In the spring of 1866, Hodgson declared a 3% dividend on ordinary shares, but the share price continued to decline. In the Autumn of 1866 Hodgson was again proposing a dividend of 3% but a new company secretary, John Walker, alerted the finance committee to the true state of the NBR's finances. A new preference share issue had flopped, and it proved impossible to pay debenture interest and preference share guaranteed dividends. Evidently it was intended to pay the dividend out of new capital; North British ordinary shares fell overnight by 8% after this revelation. Widespread financial impropriety and falsification of accounts were disclosed, all laid at Hodgson's door, and this was reported to a Special General Meeting on 14 November 1866.