enron mentions - 11 / 29 / 01 daschle calls for congressional investigation of enron collapse
bloomberg , 11 / 29 / 01
enron troubles hit houston office market ; tower project delayed
bloomberg , 11 / 29 / 01
newpower has enough cash to run through 2 nd quarter ( updatel )
bloomberg , 11 / 29 / 01
txu ' s taylor comments on effect of possible enron bankruptcy
bloomberg , 11 / 29 / 01
nymex tells members enron trades must be approved ( updatel )
bloomberg , 11 / 29 / 01
enron metals close to finding a buyer , administrators say
bloomberg , 11 / 29 / 01
german bank enron exposure between $ 9 million and $ 100 million
bloomberg , 11 / 29 / 01
enron corp . is poised to file largest - ever bankruptcy case
bloomberg , 11 / 29 / 01
enron ' s overseas assets could complicate bankruptcy
dow jones emerging markets report , 11 / 29 / 01
usa : ice electronic energy trade soars on enron woes .
reuters english news service , 11 / 29 / 01
unwind of enron derivatives could be mkt ' s biggest ever
dow jones capital markets report , 11 / 29 / 01
usa : us 10 - yr t - note up full point on weak data , enron .
reuters english news service , 11 / 29 / 01
reliant resources says enron situation manageable and presents opportunities
pr newswire , 11 / 29 / 01
enron european counterparties largely blase on exposure
dow jones energy service , 11 / 29 / 01
usa : u . s . stocks buoyed by corporate earnings .
reuters english news service , 11 / 29 / 01
enron troubles hand further ammunition to dollar bears
dow jones news service , 11 / 29 / 01
uk : uk prompt electricity dives on enron backlash .
reuters english news service , 11 / 29 / 01
enron didn ' t trade on swiss power market thursday
dow jones international news , 11 / 29 / 01
us power , gas markets remain orderly despite enron exit
dow jones energy service , 11 / 29 / 01
usa : enron opens eol trade system to unwind positions .
reuters english news service , 11 / 29 / 01
germany : german power jumpy , cal 02 up on enron crisis .
reuters english news service , 11 / 29 / 01
europe funds ' exposure to enron limited ; many sold early
dow jones international news , 11 / 29 / 01
enron metals trading staff say bnp , coke metals , hsbc rumoured possible buyers
afx news , 11 / 29 / 01
enron said to guarantee europe pwr delivery only thu , fri
dow jones energy service , 11 / 29 / 01
usa : dynegy cites deterioration in enron operations .
reuters english news service , 11 / 29 / 01
csfb : three big banks have $ 1 . 5 b loan exposure to enron
dow jones capital markets report , 11 / 29 / 01
usa : update 1 - daschle says congress needs answers on enron .
reuters english news service , 11 / 29 / 01
enron crisis hits four japanese money mgmt funds - nikkei
dow jones international news , 11 / 29 / 01
enron bonds signal anticipated enron bankruptcy filing
dow jones capital markets report , 11 / 29 / 01
usa : nymex restricts trading with enron .
reuters english news service , 11 / 29 / 01
enron fallout continues to pressure bank sector bonds
dow jones capital markets report , 11 / 29 / 01
williams president reaffirms 2001 earnings guidance ; 15 % annual earnings growth
pr newswire , 11 / 29 / 01
daschle calls for congressional investigation of enron collapse
2001 - 11 - 29 12 : 30 ( new york )
washington , nov . 29 ( bloomberg ) - - following are comments
made this morning by senate majority leader tom daschle when asked
about the collapse of enron corp . :
` ` we ' re certainly going to try to find answers to
the questions involving the collapse of enron . i don ' t know that
anybody knows yet just how this happened and how it happened so
quickly .
` ` i think we need to find as much information as is possible
and make some assessment about whether it ' s indicative of energy
in a larger context and if it is , what we ought to do about it .
but clearly it raises some very serious questions . ' '
enron troubles hit houston office market ; tower project delayed
2001 - 11 - 29 12 : 25 ( new york )
enron troubles hit houston office market ; tower project delayed
houston , nov . 29 ( bloomberg ) - - trammell crow co . delayed
construction of a $ 108 million office development in downtown
houston , the first real estate project in the city to suffer the
fallout from enron ' s financial troubles .
trammell crow delayed groundbreaking on the planned 34 - story
tower until at least next year , said leah rogers , a trammell crow
spokeswoman . construction was to have started next week .
` ` given the national economic uncertainty and the uncertainty
associated with the future availability of class ` a ' space
springing from the recent events at enron , we have decided to
delay our construction start until future visibility improves , ' '
matt khourie , who heads trammell crow ' s houston development
operations , said in a statement .
enron , the largest u . s . energy trader , may have to file for
bankruptcy protection and liquidate assets after dynegy inc .
abandoned its proposed purchase of the company , investors and
analysts said . with enron expected to give most of the 3 million
square feet it occupies in houston , developers will have a harder
time filling projects , forcing rental rates down , brokers said .
about 2 million square feet of enron ' s space is in the city ' s
downtown , where trammell crow ' s ballpark place project was
planned . the project was to include apartments and retail space ,
and sit next to enron field , home to the major league baseball
team houston astros , according to the houston chronicle , which
reported the delay earlier .
houston has 4 projects under construction , including a 40 -
story , 1 . 17 - million - square - foot tower being built by enron next to
its current headquarters . the projects are mainly being built for
power companies , said peyton collins , head of property broker
insignia / esg ' s houston office .
` ` the downtown market is 5 percent vacant and if you look
five years out , with all the space that ' s coming in line , vacancy
rates could double , ' ' said collins .
other houston office projects underway include an 800 , 000 -
square - foot building in which reliant resources will lease 550 , 000
square feet , and a 600 , 000 - square - foot tower , half of which will
be occupied by calpine corp . , according to insignia .
newpower has enough cash to run through 2 nd quarter ( updatel )
2001 - 11 - 29 12 : 36 ( new york )
newpower has enough cash to run through 2 nd quarter ( updatel )
( updates with financing details in second paragraph and
enron ' s third - quarter loss on investments in sixth paragraph . )
purchase , new york , nov . 29 ( bloomberg ) - - newpower holdings
inc . , a venture formed by enron corp . to compete with traditional
natural - gas and electric utilities , said it has enough cash and
credit to run through the second quarter .
the company is negotiating with lenders for $ 50 million for
next year and another $ 50 million in 2003 , spokeswoman gael doar
said . newpower , 44 percent owned by enron , may need money to buy
gas for winter inventories next year , she said .
newpower said a possible enron bankruptcy filing probably
won ' t affect its earnings . the purchase , new york - based company
said it can meet its credit obligations to enron and utilities and
will continue to deliver to customers .
newpower had 805 , 000 customers at the end of the third
quarter and said it expects to have 840 , 000 to 860 , 000 by the end
of the year . most electricity customers are in texas . georgia is
its largest gas market , doar said . it also has business in ohio ,
pennsylvania and elsewhere .
dynegy inc . yesterday abandoned its bid for rival enron , once
the biggest energy trader , after standard i ' m sure i can expect some of
that sort of stuff but nothing yet today . i ' m sure they ' ve got
other things to think about . ' '
nymex tells members enron trades must be approved ( updatel )
2001 - 11 - 29 12 : 47 ( new york )
nymex tells members enron trades must be approved ( updatel )
( adds margin increases in fourth - fifth paragraphs . )
new york , nov . 29 ( bloomberg ) - - new york mercantile exchange
president j . robert collins told floor members they could not
accept orders from enron corp . unless they receive written
authorization from an exchange clearing member .
a fax from collins to member firms today said the order was
effective immediately and that it would ` ` remain in effect until
further notice from the exchange . ' '
clearing members are companies that guarantee transactions on
the exchange , which trades energy and metals futures and options .
the exchange yesterday said it will raise margins on its
natural gas and crude oil futures contracts at the close of
trading today . margins are deposits traders must make with the
exchange when buying or selling futures contracts to ensure
obligations will be met .
while the exchange gave no reason for the increase , the
decision followed a day of wide changes in natural gas prices . the
swings began after dynegy inc . abandoned plans to purchase enron ,
once the biggest gas trader . traders grew concerned that enron
might be forced into bankruptcy .
enron metals close to finding a buyer , administrators say
2001 - 11 - 29 13 : 32 ( new york )
enron metals close to finding a buyer , administrators say
london , nov . 29 ( bloomberg ) - - enron corp . ' s metals unit , one
of the biggest traders on the london metal exchange , is close to
being sold , its administrator said , an accord that would end an 18 -
month foray into markets for copper and similar products .
possible buyers include hsbc holdings plc , glencore
international ag and the current management of the company ,
traders and analysts speculated . officials at the companies
couldn ' t immediately be reached for comment .
` ` there is already very serious interest in enron ' s metal
business , and negotiations are expected to lead to a successful
deal ' ' soon , said tony lomas , a pricewaterhousecoopers
administrator for enron in europe . ` ` our primary focus will be on
the large physical assets and trading position of the group . ' '
traders and analysts have speculated that enron metals would
be sold since dynegy inc . agreed earlier this month to buy enron
corp . for $ 23 billion . after that accord collapsed yesterday , the
metals unit seemed slated for a sale , analysts said .
enron agreed to buy the business , formerly mg plc , for $ 445
million in may of last year . mg itself was the metals - trading unit
of germany ' s metallgesellschaft ag and a century - old operation
upon which that german construction , engineering and trading
company was built .
it is one of just 11 floor traders on the london metal
exchange , the world ' s biggest metals bourse . enron earned
commissions though brokering trades there , charged rent at its
warehouses owned by henry bath & son ltd . and speculated on the
direction of metals prices .
declining market
the former chief executive of metallgesellschaft , heinz
schimmelbusch , in an interview earlier this month denied
speculation that his pennsylvania - based safeguard international
fund lp was interested in buying enron or any metals - trading
operation .
hsbc , europe ' s biggest bank by market value , said last month
it ' s considering a plan to add trading of industrial metals such
as copper and aluminum to its precious - metals trading operation to
meet demand from its customers .
any interest from glencore may stem from its desire to expand
its existing operations , said mike price , head of mining and
metals at societe generale , which is itself a so - called ring
dealer , or floor trader , on the lme .
whoever buys enron metals ` ` has to be somebody pretty
substantial , ' ' price said . if the current management hopes to be
the buyer , ` ` they would need to find somebody with deep pockets . ' '
the new owner of enron metals will be entering the metals
market at a time when copper prices have declined 15 percent this
year and aluminum prices are 7 percent down as demand dropped from
users such as aircraft makers and electronics companies amid
slowing economies .
the declining prices have led n . m . rothschild & sons , a
member of the lme , to quit base metals trading and prompted
scotiamoccata , a metals - trading unit of canada ' s bank of nova
scotia to leave the lme ring .
the departure of scotiamoccata reduced the number of ring
dealers to 11 and raised doubts about the future of open - outcry
trading at the exchange . the lme is promoting less - expensive
electronic trading .
german bank enron exposure between $ 9 million and $ 100 million
2001 - 11 - 29 13 : 32 ( new york )
german bank enron exposure between $ 9 million and $ 100 million
frankfurt , nov . 29 ( bloomberg ) - - dresdner bank ag , which is
owned by allianz ag , said its exposure to enron corp . is about
$ 100 million .
deutsche bank ag and commerzbank ag said their exposure to
enron amounts to a ` ` double - digit ' ' million euros amount .
europe ' s largest bank has an exposure ` ` significantly ' ' below
100 million euros ( $ 89 million ) , said ronald weichert , a spokesman
for deutsche bank .
commerzbank ' s exposure is more than 10 million euros and less
than 50 million euros , spokesman peter pietsch said .
dresdner expects ` ` way less ' ' than $ 100 million to default ,
and will take the appropriate loan loss reserves at the end of the
year , said spokeswoman elke pawellek .
the largest u . s . energy trader , may file for bankruptcy
protection after dynegy inc . yesterday abandoned its proposed
merger with enron , forcing enron to liquidate assets to pay some
of its $ 15 billion in publicly held debt .
enron corp . is poised to file largest - ever bankruptcy case
2001 - 11 - 29 14 : 04 ( new york )
enron corp . is poised to file largest - ever bankruptcy case
washington , nov . 29 ( bloomberg ) - - enron corp . is poised to
file the largest bankruptcy reorganization in history after dynegy
inc . scuttled plans to acquire the energy trader that is saddled
with more than $ 15 billion in debt .
enron , with less than $ 2 billion in cash as of last week ,
must pay $ 690 million to lenders by mid - december and is
responsible for another $ 3 . 9 billion in debt owed by affiliated
partnerships .
the houston - based company ' s collapse was underscored by new
restrictions on its operations . the new york mercantile exchange
barred floor members from accepting orders from enron without
special written authorization , and the company ' s internet trading
was reduced from about 30 commodities to three products .
a bankruptcy filing by enron would top texaco inc . ' s record
$ 35 . 9 billion case in 1987 , with creditors lining up to claim
what ' s left of the company ' s more than $ 61 billion in assets .
` ` it ' s a black hole , ' ' said gary hindes , managing director of
deltec asset management llc , which has no investment in enron .
` ` until the forensic accountants can get in there and sort things
out , you just don ' t know what enron ' s worth . ' '
duke energy corp . , j . p . morgan chase & co . , williams cos . and
a dozen other companies say they may lose more than $ 1 billion
combined from enron ' s collapse . electricity and natural gas
companies said enron owed them almost $ 600 million as of
yesterday .
in london , was appointed administrator
of enron ' s european holding company and some of its operating
companies , a step other companies have taken before filing chapter
11 papers in the u . s .
enron shares have lost more than $ 26 billion in market value
in the last six months .
lawyers
enron has hired the law firm weil gotshal & manges llp , which
has the nation ' s largest bankruptcy practice , and the blackstone
group lp investment banking firm . arthur newman , head of
restructuring at blackstone , said his firm was retained but
declined to comment further .
chapter 11 would let enron officials continue to control the
company while negotiating a recovery plan with creditors . a
provision of u . s . bankruptcy law automatically blocks debt -
collection efforts , lawsuits and other actions against the
company .
` ` a chapter 11 filing can be a great thing for a cash - starved
company being attacked from all sides , ' ' said nancy rapoport , dean
of the university of houston law center .
thousands affected
an enron bankruptcy would affect thousands of people ,
including the company ' s 21 , 000 employees , its customers ,
suppliers , investors and other creditors . the court - supervised
recovery process would give enron a chance to change strategies
and fix mistakes . it might take years to complete and may end in
the company ' s liquidation .
in addition to its energy trading operation , enron operates a
nationwide gas pipeline system spanning 25 , 000 miles . it also owns
portland general electric , which generates and distributes power
to about 725 , 000 customers in the pacific northwest . the company ' s
enron broadband services is building a global fiber - optic
communications network .
chapter 11 reorganization lets companies abandon onerous
contracts and unprofitable leases .
` ` every bad business deal enron got into they ' ll walk away
from , ' ' said peter chapman , a distressed - debt investor who also
publishes newsletters on high - profile bankruptcy reorganizations .
recovery
the goal in chapter 11 is a recovery plan that allows a
company to pay creditors and come out of bankruptcy . a plan
typically must be approved by a majority of creditors representing
two - thirds of a company ' s debts . then a company would ask a
bankruptcy judge for final approval .
the recovery plan divides a company ' s value among various
classes of creditors . under a hierarchy set by the u . s . bankruptcy
code , secured creditors - - those with collateral backing their
claims - - are paid ahead of unsecured creditors , such as
bondholders and suppliers .
financial advisers to creditors and companies in large
bankruptcies say a chapter 11 recovery plan for enron would be
particularly difficult to produce .
` ` you have a host of intangible assets combined with a morass
of contingent liabilities creating a potential witches ' brew of a
bankruptcy , ' ' said jeff werbalowsky of houlihan lokey howard &
zukin , an investment banking firm that has been contacted for
advice by enron bondholders .
shareholders
enron ' s shareholders are likely to lose all of their
investment in a chapter 11 case because they would be last in line
to get paid .
enron shares fell 20 cents , or 33 percent , to 41 cents in
afternoon trading . the shares traded at $ 54 . 54 on june 4 . the
company said this morning it was evaluating whether it will pay a
scheduled 12 . 5 - cent quarterly dividend on dec . 20 .
enron ' s bond prices reflect the uncertainty about the
company ' s value . the company ' s 6 . 4 percent notes that mature in
2006 were unchanged at about 22 cents on the dollar , traders said .
at that price the notes yield 53 percent .
some recovery for enron creditors in a bankruptcy case may
come from lawsuits , said russell a . belinsky , an investment banker
with chanin capital partners , which also has been approached for
advice by enron bondholders .
` ` there ' s a lot of juicy legal issues , ' ' said belinsky .
potential targets include enron ' s accounting firm and its officers
and directors .
` ` disentangling all the pieces in a reorganization is going
to be a painstaking job , ' ' he said .
liability
dynegy might face some liability for canceling its purchase
of enron . dynegy invoked terms of the buyout agreement that gave
it the right to purchase an enron natural gas pipeline if the
takeover fell apart . dynegy received the right to the pipeline in
exchange for a $ 1 . 5 billion investment in enron by chevrontexaco
corp . , which owns one - fourth of dynegy .
enron might use bankruptcy to prevent dynegy from walking
away from the buyout and claiming ownership to the pipeline .
the dynegy acquisition , valued at $ 23 billion when it was
proposed on nov . 9 , collapsed as bankers failed to raise the $ 1 . 5
billion enron needed to operate until the deal was completed . the
lack of funds and a credit downgrade contributed to dynegy ' s
decision .
bankers led by j . p . morgan chase & co . vice chairman james b .
lee tried for two weeks to raise the cash enron needed . investors
turned them down because of heightened concern enron wouldn ' t be
able to pay its debts .
three credit - rating agencies yesterday cut enron ' s credit
rating to junk status , triggering an acceleration of the company ' s
debt obligations .
unraveling
enron ' s unraveling began in october after it said
shareholders ' equity was reduced by $ 1 . 2 billion because of the
way the company accounted for outside partnerships it created . the
announcement prompted lawsuits and an investigation by the u . s .
securities and exchange commission , and enron ended up restating
earnings for almost five years .
as shares plunged , enron ' s trading partners lost confidence
the company would have the cash to pay bills . trading partners
such as mirant corp . either demanded more collateral to trade or
restricted trading with the company .
` ` the situation is dire , ' ' said deltec ' s hindes . ` ` no one ' s
going to trade with enron right now because you could wind up
being an unsecured creditor tomorrow . ' '
enron ' s overseas assets could complicate bankruptcy
by charles roth
of dow jones newswires
11 / 29 / 2001
dow jones emerging markets report
( copyright ( c ) 2001 , dow jones & company , inc . )
new york - ( dow jones ) - as enron corp . ( ene ) teeters on the edge of insolvency , its creditors , power industry players and even foreign governments are angling to lay claim to the company ' s assets .
in an example of how far the ripples are being felt , the brazilian government said thursday it ' s legally entitled to seize enron ' s assets in that country if the u . s . energy titan files for bankruptcy .
the houston - based company has more than $ 60 billion in assets , a little more than 10 % of which are considered " non - core " or located overseas . indeed , of enron ' s 10 , 453 megawatts in total power production , 8339 mw are generated internationally .
as it established a presence in dozens of countries , enron also diversified into oil and gas exploration and production , power generation , and even non - energy related businesses such as forest products , metals and steel , broadband and credit evaluation systems .
although enron ' s non - core and global forays haven ' t on the whole been profitable , there is value in some of the hard assets .
and while it ' s not clear whether or how claims by foreign governments on enron assets would be honored , it ' s certain the company ' s myriad overseas holdings will further addle what would likely be a vastly complex bankruptcy proceeding .
the following is an overview of a number of those holdings outside the north american continent , according to some of the most recent data provided by the company , which didn ' t , however , specify the extent of its equity interests or operational control in the majority of the assets listed .
approximately 70 % of enron ' s assets outside north america and europe are located in central and south america and the caribbean :
- - - brazil : enron controls electricity distributor elektro eletricidade e servico sa ( e . eko ) , which was acquired in 1998 for brrl . 479 billion ( $ 1 = brr 2 . 48 ) . it also owns two gas - fired thermoelectric plants : eletrobolt , with a capacity of 380 megawatts , and cuiaba , with a 480 - mw capacity .
enron also owns important stakes in natural gas distributor companhia distribuidora de gas do rio de janeiro ( e . cdr ) , or ceg , and its smaller unit ceg - rio .
in late april , brazil ' s oil giant petroleo brasileiro ( pbr ) , or petrobras , agreed to pay $ 240 million for the stake enron owns in ceg . petrobras agreed to buy the 25 . 38 % stake the u . s . energy group owns in ceg as well as the 33 . 75 % stake enron has in ceg - rio . the deal is still seen closing in the next few days .
- - - puerto rico : enron has been poised to sell in the weeks ahead a 49 % interest in the 507 mw ecoelectrica power plant and liquified natural gas terminal for about $ 250 million .
it ' s also involved in a 20 , 000 metric ton liquefied petroleum gas storage terminal and the san juan gas distribution company , which has a capacity to carry approximately 400 , 000 cubic feet a day .
- - - bolivia : enron is an operator on the bolivian side of the 3 , 000 kilometer bolivia - to - brazil natural gas pipeline , and holds a small 4 % interest on the brazilian side .
- - - argentina : enron has an interest in transportadora de gas del sur , a 5 , 005 kilometer pipeline .
- - - venezuela : enron , in cooperation with vengas , is involved in a leading transporter and distributor of lpg , among other assets .
- - - colombia : enron has stakes in the centragas pipeline , a 578 km natural gas transmission system , and promigas , a top natural gas company .
- - - panama : enron holds a 355 mw electricity generation plant .
- - - guatemala : enron has two power plants with combined generating capacity of 234 mw .
- - - dominican republic : enron has a 185 mw power facility .
the company also has a sizeable footprint in asia , particularly in india :
- - - india : about 14 % of enron ' s international assets are located in india , home to its mammoth $ 3 billion dabhol power project , which has a generation capacity of 2184 mw .
enron is also poised to sell its offshore india oil 201 - 938 - 2226 ; charles . roth @ dowjones . com
( geoffrey smith in london contributed to this article . )
copyright ? 2000 dow jones & company , inc . all rights reserved .
usa : ice electronic energy trade soars on enron woes .
11 / 29 / 2001
reuters english news service
( c ) reuters limited 2001 .
new york , nov 29 ( reuters ) - the intercontinental exchange ( ice ) , an atlanta - based electronic energy and metals marketplace , said on thursday that trade on its system in late november was up 65 percent from october .
ice has been setting new trading records in recent weeks , as concerns over energy trader enron corp . ' s crumbling credit rating diverted on - line business to the exchange .
enron suspended operations of enrononline , ice ' s main rival for internet - based trading , on wednesday after standard & poor ' s cut enron ' s credit rating to " junk " status , killing a potential takeover by dynegy inc . .
enron , which said it has no plans to permanently dismantle its electronic trading system , said it reopened enrononline thursday to allow parties to unwind outstanding positions .
until this month , enron was by far the nation ' s largest trader in north american natural gas and electricity , with industry analysts estimating it was involved in some 25 percent of all daily trade in those markets .
in addition to increased volumes , ice has also seen a big jump in the number of users tapping into the system , up 30 percent from october , the exchange said in a statement .
" over the past couple of weeks we have experienced an increase in total volumes and registered users , " said jeffrey sprecher , chief executive officer of ice .
" we believe the inherent credit concerns in the otc ( over - the - counter ) market have spawned interest in a many - to - many trading platform as opposed to a one - to - many platform .
sprecher also said ice would continue to look for ways to expand its trading platform to accommodate new participants .
as an open - access marketplace , intercontinental exchange now has over 400 commodity trading firms participating .
the ice electronic trading system is now installed on over 7 , 500 desktops worldwide , a 7 percent gain in the past two weeks .
products traded on ice include natural gas , power , crude oil and refined products , precious metals and emissions allowances .
intercontinental exchange has offices in new york , houston , chicago , london and singapore and is owned by over 100 energy and metals traders , brokers and bankers .
copyright ? 2000 dow jones & company , inc . all rights reserved .
unwind of enron derivatives could be mkt ' s biggest ever
by joe niedzielski
of dow jones newswires
11 / 29 / 2001
dow jones capital markets report
( copyright ( c ) 2001 , dow jones joe . niedzielski @ dowjones . com
copyright ? 2000 dow jones & company , inc . all rights reserved .
usa : us 10 - yr t - note up full point on weak data , enron .
11 / 29 / 2001
reuters english news service
( c ) reuters limited 2001 .
new york , nov 29 ( reuters ) - u . s . benchmark 10 - year notes soared more than a full point on thursday as a broad treasury market rally on hopes for another federal reserve rate cut extended amid concerns the beleaguered energy - trading company enron will soon file for bankruptcy .
enron corp . stood at the abyss of bankruptcy on thursday , as its european arm filed for creditor protection and creditors assessed their exposure to one of the world ' s biggest - ever corporate collapses .
" it looks like enron is going to file bankruptcy , " said jim claire , head of fixed income trading at evergreen institutional asset management in charlotte , north carolina . " this is kind of a flight to quality . "
an early report showing a spike in weekly jobless claims in the past week highlighted the frail u . s . economy , boosting market expectations that the fed will cut interest rates for the 11 th time this year at its policy meeting on december 11 .
at 1 : 13 p . m . ( 1813 gmt ) , two - year notes were up 8 / 32 to 100 - 1 / 32 , yielding 2 . 96 percent . five - year notes climbed 22 / 32 to 97 - 3 / 32 , yielding 4 . 15 percent . benchmark 10 - year notes were up 30 / 32 to 101 - 14 / 32 , yielding 4 . 81 percent . thirty - year bonds were up 1 - 15 / 32 to 101 - 24 / 32 , yielding 5 . 26 percent .
.
copyright ? 2000 dow jones & company , inc . all rights reserved .
reliant resources says enron situation manageable and presents opportunities
11 / 29 / 2001
pr newswire
( copyright ( c ) 2001 , pr newswire )
houston , nov . 29 / prnewswire / - - reliant resources , inc . ( nyse : rri ) today announced that it is confident that the wholesale energy markets will work through the implications caused by enron ' s recent credit rating downgrade . because the deterioration in enron ' s credit position has occurred over a period of weeks , the market and reliant resources have had opportunities to prepare for such an event . reliant resources ' current exposure to enron is approximately $ 80 million , primarily from power sales from the company ' s asset portfolio and natural gas sales from its trading portfolio .
reliant resources has already seen additional market opportunities as a result of the situation and is increasing its efforts to serve new and existing customers .
reliant resources , based in houston , texas , provides electricity and energy services to wholesale and retail customers in the u . s . and europe , marketing those services under the reliant energy brand name . the company has nearly 18 , 000 megawatts of power generation capacity in operation , under construction or advanced development , or under contract in the u . s . reliant resources is one of only five companies to rank among both the ten largest power marketers and the ten largest natural gas marketers in north america . the company also has wholesale trading and marketing operations and nearly 3 , 500 megawatts of power generation in operation in western europe . at the retail level , reliant resources provides energy services and will serve approximately 1 . 7 million customers in texas when the electricity market opens to full retail competition in january 2002 . reliant resources currently is a majority - owned subsidiary of reliant energy ( nyse : rei ) .
this news release includes forward - looking statements . actual events and results may differ materially from those projected . factors that could affect actual results include the timing and impact of future regulatory and legislative decisions , changes in reliant resources ' business plans , financial market conditions and other factors discussed in reliant resources ' filings with the securities and exchange commission .
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/ contact : media , sandra fruhman , + 1 - 713 - 207 - 3123 , or investors , dennis barber , + 1 - 713 - 207 - 3042 , both of reliant resources , inc . / 13 : 13 est
copyright ? 2000 dow jones & company , inc . all rights reserved .
enron european counterparties largely blase on exposure
by mark long
of dow jones newswires
11 / 29 / 2001
dow jones energy service
( copyright ( c ) 2001 , dow jones & company , inc . )
london - ( dow jones ) - three major spot power market exchanges suspended enron corp . ' s ( ene ) right to trade thursday , but the one - time energy giant ' s major european counterparties were more relaxed about their exposure to the company , indicating they had made full use of the breathing space afforded by dynegy inc . ' s ( dyn ) unsuccessful rescue bid .
ukpx banned enron from spot power trade thursday because it defaulted on contracts . nord pool suspended enron ' s trading rights because enron failed to meet margin requirements . apx declined to comment on why enron was suspended from u . k . trade . spanish pool operator omel was unavailable to comment on enron ' s status as a market participant in spain .
statements by leading u . k . and german companies hint that energy companies without balanced portfolios of assets may see the biggest problems on the back of the enron debacle .
u . k . multi - utility innogy plc ' s ( iog ) chief executive brian count told journalists early thursday his company wasn ' t overexposed to the defunct energy trader , although he declined to comment on innogy ' s level of exposure .
" from where i sit , there ' s one less competitor and still the same number of customers who want risk management services , " count told journalists in a telephone conference call following the release of innogy ' s first - half results .
" we ' ve had enron under review for last five weeks , " he added . " we ' ve actively managed that situation and as a company we ' re comfortable with our position with enron . we ' ll regard it as an opportunity . "
powergen plc ( pwg ) , the u . k . power giant , said it isn ' t overexposed to enron and anticipates no negative change in its market position if enron goes bankrupt .
" powergen manages risk in such a way that there will not be any negative material impact on us if enron becomes insolvent , " said a spokeswoman for powergen .
industry sources say powergen was among the first to stop trading with enron , and the company is generally highly credit - conscious .
spokesmen at both scottish power plc ( spi ) and scottish dow jones newswires ; + 44 ( 0 ) 20 7842 9356 ; mark . long @ dowjones . com
copyright ? 2000 dow jones so we are doing a little bit better but it just feels like you are not going to really explode to the upside at all , " said todd clark , co - head of equity trading at wr hambrecht . " the market is just going to sit here for a while , it will continue to correct the rally that we had . markets don ' t go up in a straight line . "
the technology - laced nasdaq composite index rose 27 . 01 points , or 1 . 43 percent , to 1 , 914 . 98 . the blue chip dow jones industrial average was up 32 . 24 points , or 0 . 33 percent , at 9 , 744 . 10 . the broader standard & poor ' s 500 index was up 5 . 84 points , or 0 . 52 percent , at 1 , 134 . 36 .
among active nasdaq stocks , palm rose after the hand - held computer maker said it expects to meet analysts ' estimates . palm rose 15 cents to $ 3 . 56 , or 4 . 4 percent .
software provider freemarkets inc . rose sharply on the nasdaq after it raised its revenue and profit outlook . freemarkets jumped $ 3 . 98 to $ 17 . 57 , 29 . 2 percent .
storage networking company brocade communications systems inc . rose $ 2 . 43 to $ 31 . 25 on the nasdaq . its profits fell sharply as the slower economy kept corporate buyers on the sidelines but still managed to meet wall street ' s estimates .
enron , teetering on the brink of one of the biggest corporate implosions in u . s . history , plunged 85 percent in frenzied trading wednesday and fell 34 . 4 percent , off 20 cents at 41 cents on the new york stock exchange . it sank as low as 35 cents initially .
enron was crushed by rival dynegy inc . ' s decision to pull out of its planned $ 9 billion takeover of the beleaguered energy trader .
the s & p natural gas index lost nearly 4 percent at one point but later cut losses . thursday ' s drop reflected losses in other firms such as williams cos . inc . , down $ 1 to $ 26 . 05 . dynegy fell 87 cents to $ 35 . 02 .
" enron went from a done deal to a dead deal , " said alan ackerman , market strategist with brokerage fahnestock & co . " the enron collapse may have significant ramifications on banks and other energy companies where contracts with enron may now not be honored . and the enron equity may be worthless . "
financial giants citigroup inc . and j . p . morgan chase & co . inc . , which lent money to the proposed enron - dynegy merged company , saw their stocks fall for a second day running but later rebounded . citigroup rose 51 cents to $ 48 . 31 and j . p . morgan rose 5 cents to $ 37 . 55 . both are components of the dow index .
nvidia corp . soared after standard & poor ' s said the multimedia graphics firm will replace energy trade enron in the s & p index of 500 top companies . nvidia soared $ 3 . 24 to $ 54 . 60 , or more than 6 percent .
sales of new u . s . homes rose for the second straight month in october , inching up 0 . 2 percent to an annual rate of 880 , 000 units , suggesting the housing market continues to be a bright spot in the ailing u . s . economy .
orders for costly u . s . durable goods surged at the fastest rate on record in october by 12 . 8 percent to $ 184 . 8 billion , the largest gain since the commerce department began records in march 1992 . the increase was led by huge orders for aircraft and defense capital goods as well as cars . the data may help rekindle hopes that the economy has rebounded since the sept . 11 attacks .
orders for motor vehicles , which were likely spurred on by increased demand due to zero interest rate loans for car purchases , jumped 10 . 6 percent .
but the number of americans lining up for first - time jobless benefits rose by 54 , 000 last week , exceeding wall street expectations .
" we saw an encouraging number in the durable goods but it ' s too early to see this as a sustained trend up and layoffs continue to be a real concern , " ackerman added .
h & r block inc . , the no . 1 u . s . tax preparer , rose $ 2 . 22 to $ 38 . 22 , or more than 6 percent . the company raised its profit forecasts for the current fiscal year helped by new accounting rules and strong mortgage business .
conexant systems inc . rose after saying it expects revenue for the december quarter to be 5 percent to 7 percent above the prior quarter ' s , driven by strong demand for chips used in wireless devices like mobile phones . its stock rose 53 cents to $ 15 . 60 , or 3 . 5 percent .
acambis plc ' s american depositary receipts shot higher on news the u . s . government awarded the british company , along with baxter international inc . , a $ 428 million smallpox vaccine contract .
acambis adrs rose $ 7 . 3 to $ 45 , or 19 . 3 percent , and baxter shares rose $ 1 . 74 $ 51 . 90 . bioreliance corp . was up 8 percent , or $ 2 . 14 to $ 28 . 19 , after the company said it would help acambis produce the vaccines under the huge contract .
copyright ? 2000 dow jones & company , inc . all rights reserved .
enron troubles hand further ammunition to dollar bears
by grainne mccarthy
of dow jones newswires
11 / 29 / 2001
dow jones news service
( copyright ( c ) 2001 , dow jones 201 - 938 - 2381 ;
grainne . mccarthy @ dowjones . com
copyright ? 2000 dow jones & company , inc . all rights reserved .
uk : uk prompt electricity dives on enron backlash .
11 / 29 / 2001
reuters english news service
( c ) reuters limited 2001 .
london , nov 29 ( reuters ) - british day - ahead electricity prices slumped on thursday as traders dumped power onto the market after cutting ties with troubled enron .
day - ahead electricity was trading down to 15 pounds per megawatt hour from 26 . 5 pounds on wednesday .
" certain parties have cut lines with counter parties and have ended up having to dump electricity on the market , " said one trader .
the electricity flooding the prompt market is power which would have gone to enron and is likely to be generated from plants which cannot easily be switched off , such as nuclear power stations .
enron ' s european business was placed into administration on thursday as its parent stands on the brink of bankruptcy after a rescue deal with smaller rival dynegy fell apart .
in forward curve trading prices for the summer 02 baseload contract finished 10 pence higher 17 . 39 pounds and winter 02 baseload was down ten pence at 19 . 25 pounds , traders said .
traders said companies could start terminating contracts with enron under the terms of the over - the - counter market ' s standard gtma contract . a clause in the gtma allows immediate termination should a counterparty become insolvent .
copyright ? 2000 dow jones & company , inc . all rights reserved .
enron didn ' t trade on swiss power market thursday
11 / 29 / 2001
dow jones international news
( copyright ( c ) 2001 , dow jones + 41 1 211 70 1 ; goran . mijuk @ dowjones . com
copyright ? 2000 dow jones & company , inc . all rights reserved .
us power , gas markets remain orderly despite enron exit
by dina o ' meara , mark golden and andrew dowell
of dow jones newswires
11 / 29 / 2001
dow jones energy service
( copyright ( c ) 2001 , dow jones & company , inc . )
new york - ( dow jones ) - trading in u . s . natural gas and electricity markets generally remained orderly thursday , and price movements continued to be muted , despite the exit of one - time market leader enron corp . ( ene ) .
some gas markets , however , saw more volatility as a result of enron ' s absence , traders said , and some electricity prices seemed stronger than justified by fundamentals , perhaps a result of buying by traders covering their exposure to enron . the moves weren ' t dramatic .
" it ' s almost business as usual , " one power trader said .
enron wasn ' t presenting a full range of prices on its internet - based platform enrononline thursday , although traders said enron was briefly making markets for some products .
traders , who for the most part aren ' t doing business with the company , attributed the activity to last - minute efforts by some energy companies to flatten their positions with enron and the energy giant ' s own efforts to close its positions .
" there ' s a lot of unwinding going on , " a trader said .
the new york mercantile exchange , the world ' s largest energy futures exchange , advised its floor members thursday morning not to accept orders placed directly to the trading floor by enron or enron affiliates without written authorization from a clearing member carrying an enron account .
the exit of a company that once accounted for a quarter of the north american power and gas markets has produced substantial changes in the way business is done in the energy markets .
traders used to transacting on enrononline were spending more time on the phone or turning to platforms like that run by , an electronic marketplace founded by a consortium of energy and financial companies . traders accustomed to looking to enrononline for pricing guidance were left to figure out the market for themselves .
the result was abnormally high volatility in the physical gas markets , particularly on gas for delivery in the next month , a trader said .
gas for delivery in december at southern california ' s topak hub was trading in a range of $ 1 . 95 to $ 2 . 55 per million british thermal units , the trader said . december gas at the san juan basin was trading at $ 1 . 70 - $ 2 . 44 .
" traders aren ' t sure where they should be trading , " the trader said .
copyright ? 2000 dow jones & company , inc . all rights reserved .
usa : enron opens eol trade system to unwind positions .
11 / 29 / 2001
reuters english news service
( c ) reuters limited 2001 .
san francisco , nov 29 ( reuters ) - beleaguered energy giant enron corp . said on thursday it had reopened its widely used electronic trading system to allow parties to unwind outstanding positions .
the company also said it has no plans to permanently dismantle its enrononline ( eol ) system , which until this month was by far the most liquid marketplace for trading north american electricity and natural gas .
" enrononline is now available to our customers to transact only in order to provide a means to manage enron credit exposure , " a message posted on the trading system said .
the message warned that " while transactions may be available , customers entering into transactions should carefully evaluate their positions and enron ' s current credit status before transacting . "
enron spokesman eric thode confirmed enrononline - which recently accounted for up to 60 percent of enron ' s business - restarted operations late wednesday .
the internet - based eol trading platform was shut earlier wednesday after credit rating agencies cut enron ' s debt to " junk " status .
thode also said the company had " no plans " to cease operations on enrononline after parties have closed all outstanding positions .
the system also carries products for trading various commodities like metals , pulp and paper .
enron is teetering on the brink of bankruptcy after a rescue deal with its smaller rival , dynegy inc . , fell apart on wednesday .
copyright ? 2000 dow jones & company , inc . all rights reserved .
germany : german power jumpy , cal 02 up on enron crisis .
11 / 29 / 2001
reuters english news service
( c ) reuters limited 2001 .
frankfurt , nov 29 ( reuters ) - german electricity prices jumped around widely on thursday , while year 2002 firmed by up to 35 eurocents due to uncertainty over the value of long - term contracts with crisis - hit counterparty enron .
enron ' s liquidity crisis reached a head on thursday when the firm announced that its european arm had filed for creditor protection .
" prices were jumpy today , which was in part due to uncertainty with enron , " a trader said .
" but enron has actually been tapering off its volumes further out for a while now , so the market didn ' t really miss any big volumes from them today , " he added .
day ahead baseload traded at 31 . 5 - 33 euros , with an early high of 35 euros and a mid - session low of 29 . 5 euros , while peakload traded at 39 . 75 - 42 . 25 euros , after peaking at 45 euros and troughing at 39 . 75 euros .
week ahead was rangebound at 29 . 75 - 31 euros , while peakload changed hands at 41 . 5 - 44 euros in quiet trading .
december baseload traded at 27 . 6 euros , before retracing to its wednesday range of 26 . 65 - 26 . 7 euros , while january baseload traded at 26 . 65 - 27 . 1 , also steady with previous levels .
year 2002 firmed to 22 . 75 from 22 . 4 euros , before falling back down to 22 . 45 and last traded at 22 . 35 - 55 .
" this was all on speculation about enron and on covering their long - term postions since delivery is now not guaranteed beyond friday , " a dealer said .
copyright ? 2000 dow jones many sold early
by ellen thalman
of dow jones newswires
11 / 29 / 2001
dow jones international news
( copyright ( c ) 2001 , dow jones & company , inc . )
berlin - ( dow jones ) - while some european mutual funds may be stuck holding enron inc . ( ene ) shares or bonds , their exposure appears fairly limited , with a number of fund companies saying they already sold off their holdings in recent months .
nevertheless , a few funds said they had some exposure in stock or bonds to the company , which stopped most trading wednesday after standard & poor ' s downgraded its credit rating to " junk " and dynegy inc . ( dyn ) abandoned plans for a buyout .
fund manger helle bendorff with bg invest in copenhagen said at the end of october , bg invest ' s international corporate bond fund had 6 . 1 million kroner , or 3 . 2 % , invested in enron corporate bonds , out of a total fund of dkkl 95 million ( $ 1 = dkk 8 . 3652 ) .
" naturally when something like this happens anyone can see it will take its toll on returns , " said bendorff . however , she wouldn ' t give further details .
enron ' s 4 3 / 8 bonds dated 2005 were trading around 20 cents to the dollar thursday , down from over 50 cents before the buyout fell through . the collapse of the dynegy deal leaves enron bondholders holding about $ 13 billion in debt versus an unknown base of assets .
analysts widely expect enron to file for insolvency protection , and its liquidation value will be the focus for bondholders . bondholders are therefore more likely to get something back than investors who are left holding stocks .
in contrast with u . s . counterparts , most european stock funds ' exposure appears fairly low , however , and any hit to their value was probably already taken in the last months .
fund managers and spokespeople at a number of european fund houses that had been known to have holdings in enron shares in the past said they sold off those assets in recent months and weeks .
a spokesman at dutch funds company ohra beleggingen beheer bv said the fund sold its enron holdings at the end of october . they had comprised around 4 . 7 % of its eur 20 million new energy fund and were also included in some other funds , according to funds tracking company morningstar . he said they took a loss on the investment , but stressed they still unwound their holdings on time .
a fund manager at denmark ' s uni - invest said the firms electronic business unit trust had sold off its holdings in enron prior to the current troubles . as of the end of september the unit trust had held 3 . 6 % of its assets in enron stock . the size of the unit trust is dkk 585 million , the manager said .
dresdner bank ' s dit funds arm also sold off all its enron holdings in its energie fonds after the company ' s third - quarter earnings report , a spokesman said , as did ubs ' ag ' s ef - energy fund .
european energy funds tend to be rather small , so even if the fund is highly exposed , it ' s unlikely to have any market impact . the largest energy funds are only several hundred million euros , for example .
in the u . s . , the picture was somewhat different .
enron may have been held by some major u . s . funds , according to the funds ' most recent securities and exchange commission filings . those include fmr corp . ' s ( x . fin ) fidelity investments , stilwell financial inc . ' s ( sv ) janus capital corp . , alliance capital management ( ac ) and putnam investments . vanguard group inc . ( x . vgi ) held the stock in various portfolios , including its giant passively managed index funds , according to its filings .
the $ 11 billion alliance premier growth fund had about 4 % of its assets in enron shares as of sept . 30 , according to morningstar . based on the sept . 30 filing , the fund ' s stake had dropped in value by about $ 445 million through wednesday . a spokeswoman for janus said the company ' s mercury fund , which had 3 . 6 % of its assets invested in enron stock on april 30 , had disposed of all its enron shares by mid - november .
many of the stock funds in europe that are still holding enron funds also reduced their weightings considerably in recent months , according to their representatives .
a spokesman for u . k . - based investec said the company is still holding some enron stock , but wouldn ' t give specific data . morningstar listed the global privatization fund and the wired index fund as holders of enron stock , but investec ' s web site doesn ' t list the funds in the top 10 holdings .
" our enron positions in each of these funds is less than 3 % - it ' s a non - material exposure . we cut our loss positions about two months ago , and we were underweight even before that for a year now , " he said . " the wired index fund tracks the wired index ( a u . s . new - economy index ) and enron is a constituent of that , so our holding is the constituent portion . "
separately , standard and poor ' s said enron will be removed from its sdow jones newswires ; 49 - 302888410
( anita greil , xueling lin , neil moorhouse , nisha gopalan and henry j . pulizzi contributed to this story . )
copyright ? 2000 dow jones & company , inc . all rights reserved .
enron metals trading staff say bnp , coke metals , hsbc rumoured possible buyers
11 / 29 / 2001
afx news
( c ) 2001 by afp - extel news ltd
new york ( afx ) - enron corp ' s metal trading division has sparked some interest from potential buyers with rumours from the company ' s own trading floor putting bnp paribas , coke metals group , hsbc banking group and goldman sachs & co inc in the frame , an enron metals trader said .
he added that employees have not yet received any information from management on the future of the troubled energy giant following news from london this morning that enron ' s european office has gone into administration .
" everybody showed up for work today , it ' s still a working entity but we ' ve had no word , no internal memos as yet , " the employee told afx news . " we ' re completely in the dark . "
according to reports , an official from administrator has said there is strong interest in the company ' s metals trading division , sparking speculation within the company of potential acquirers , he said .
parties rumoured to be interested in acquiring the division include bnp paribas , coke metals , hsbc and goldman sachs .
" enron still has a membership of the london metals exchange which is of interest to banks who want to get back into the business , " said the employee , who requested anonymity .
" it ' s not the only asset that would be of interest though . the pipeline and fact that ( enron ) has warehousing should be worth hundreds of millions of dollars . "
enron , which employs a total of 21 , 000 people , has been flooded with phone calls all morning from customers seeking information on the company ' s plans .
" for now , we ' re still optimistic that a solution will be found and we won ' t lose our jobs , " said the employee .
analysts are expecting enron to file for bankruptcy protection after dynegy inc yesterday terminated their merger agreement and the company ' s ratings were reduced to junk status .
the stock , which lost 85 pct of its value yesterday , has been forced out of the s & p 500 .
cl / jad
copyright ? 2000 dow jones & company , inc . all rights reserved .
enron said to guarantee europe pwr delivery only thu , fri
11 / 29 / 2001
dow jones energy service
( copyright ( c ) 2001 , dow jones 331 - 4017 - 1740 ; sarah . wachter @ dowjones . com
copyright ? 2000 dow jones & company , inc . all rights reserved .
usa : dynegy cites deterioration in enron operations .
11 / 29 / 2001
reuters english news service
( c ) reuters limited 2001 .
houston , nov 29 ( reuters ) - dynegy inc . chairman and chief executive chuck watson on thursday said disclosures by enron corp . of further deterioration in its operations led dynegy to pull out of a deal to acquire the beleaguered energy trading giant and keep it afloat .
a nov . 19 filing with regulators showed that enron faced insurmountable problems both in the long term and the short term , causing dynegy to invoke " material adverse change " clauses allowing it to pull out of its agreement to acquire enron , watson said in an interview with cnbc television .
announcements on wednesday by credit - rating agencies that they had downgraded enron debt to junk status also played a key role in dynegy ' s decision , he said .
watson said dynegy is confident that it will take control of enron ' s northern natural gas pipeline unit next month under a clause of the acquisition agreement that allowed it to keep the 16 , 500 miles of pipeline if the deal collapsed .
enron has said it will contest dynegy ' s claim to the pipeline .
copyright ? 2000 dow jones & company , inc . all rights reserved .
csfb : three big banks have $ 1 . 5 b loan exposure to enron
11 / 29 / 2001
dow jones capital markets report
( copyright ( c ) 2001 , dow jones 201 - 938 - 4192 ; michael . derby @ dowjones . com
copyright ? 2000 dow jones & company , inc . all rights reserved .
usa : update 1 - daschle says congress needs answers on enron .
11 / 29 / 2001
reuters english news service
( c ) reuters limited 2001 .
washington , nov 29 ( reuters ) - u . s . senate majority leader tom daschle said on thursday that congress should find out what brought one - time energy giant enron corp . to the brink of bankruptcy , and see if it has broader ramifications for the energy industry .
" we certainly need to try to find answers to the questions involving the collapse of enron , " the south dakota democrat told reporters .
" i think we need to find as much information as possible , and make some assessments of whether it ' s indicative of energy in the larger context and if it is , what we ought to do about it . but clearly , it raises some very serious questions , " daschle said .
activity at many enron units in more than 40 countries around the world ground to a halt this week . the global giant employs 21 , 000 people in operations ranging from marketing electricity and natural gas to delivering commodities such as metals , coal , pulp and paper .
house energy and commerce committee chairman billy tauzin said on wednesday he did not see a way for the government to try to rescue enron , which was near collapse after rival energy trader dynergy inc . pulled out of a deal to buy it .
" i can ' t right now envision anything the government can do , other than encourage the parties who are discussing a merger to continue their efforts , " said tauzin , a louisiana republican .
copyright ? 2000 dow jones & company , inc . all rights reserved .
enron crisis hits four japanese money mgmt funds - nikkei
11 / 29 / 2001
dow jones international news
( copyright ( c ) 2001 , dow jones & company , inc . )
tokyo ( nikkei ) - - the reverberations of the crisis at u . s . energy trading giant enron corp . are starting to shake japanese investors , the nihon keizai shimbun reported in its friday morning edition .
with enron now on the edge of bankruptcy , money management funds managed by nikko asset management co . and three other fund companies fell below their par value of yl 0 , 000 thursday due to losses on enron bonds .
the money management funds have apparently fallen 0 . 5 % to 7 % under par value , a significant loss of principal given that the funds total more than y 3 trillion in size .
japan has experienced two previous cases of money management funds falling under their face value , but the losses were smaller in scale .
the four fund companies are being besieged with redemptions by nervous investors anxious to retrieve their money . nikko asset management , for example , has reportedly received requests for redemptions totaling more than yl trillion out of a total fund balance of y 2 . 7 trillion .
japan investment trust management co . and sumisei global investment trust management co . , two of the other firms hit by losses on enron bonds , also received redemption requests equivalent to nearly 30 % of total fund assets . the fourth firm affected was ufj partners asset management co .
jittery investors , meanwhile , are asking other fund companies , even those not affected by the enron crisis , to disclose their asset holdings in money management funds .
in response , shinko investment trust management co . has drawn up plans to send to brokers materials disclosing all holdings in its money management fund and a medium - term government bond investment fund .
daiwa asset management co . is also considering ways to beef up disclosure for what is the largest money management fund in the industry .
analysts and industry executives are expressing concern that the declines below the par value could cause investors to rethink the safety of money management funds . these funds have been marketed as ultrasafe investment vehicles and a good alternative to bank deposits when a cap on deposit insurance protection is reimposed in april next year . with interest rates continuing to languish at extremely low levels , some fund managers have been tempted to add riskier corporate bonds to their holdings in an attempt to pump up fund yields .
money management funds had more than yl 8 trillion in assets as of the end of october , accounting for about one - third of assets in all investment trusts .
copyright ? 2000 dow jones & company , inc . all rights reserved .
enron bonds signal anticipated enron bankruptcy filing
by michael c . barr
of dow jones newswires
11 / 29 / 2001
dow jones capital markets report
( copyright ( c ) 2001 , dow jones & company , inc . )
new york - ( dow jones ) - the corporate bond market is signaling its anticipation of an imminent bankruptcy filing by beleaguered energy services company enron corp . ( ene ) .
there is a 22 - 1 / 2 bid both for bonds maturing in 2003 and 2009 . and neither bid is with accrued interest .
the combination of the bonds trading without accrued interest , or flat , and the withering of the normal gap in price between shorter - and longer - dated maturities means the market believes " the company is probably going into bankruptcy , " said tom haag , senior analyst in charge of distressed securities , lutheran brotherhood , minneapolis .
by trading flat , investors are saying that they do not expect to receive any further interest payments from enron . and the sameness of price , regardless of maturity , signals that the market believes all the bonds will be treated the same in a bankruptcy proceeding , said haag .
normally , bond prices reflect greater risk of repayment for longer - dated maturities .
on wednesday , before standard & poor ' s and the two other major ratings agencies downgraded enron to speculative grade from investment grade , enron ' s 7 - 7 / 8 % coupon bonds maturing in 2003 were being offered at a price of $ 59 with accrued interest , traders said .
after the downgrades , prices fell into the 20 s but the bonds were still quoted with accrued interest , said harold rivkin , principal , h . rivkin 201 - 938 - 2008 ; michael . barr @ dowjones . com
copyright ? 2000 dow jones & company , inc . all rights reserved .
usa : nymex restricts trading with enron .
11 / 29 / 2001
reuters english news service
( c ) reuters limited 2001 .
new york , nov 29 ( reuters ) - the new york mercantile exchange thursday morning restricted trades with beleaguered energy firm enron corp . or its affiliates , floor traders said .
before thursday ' s opening of floor trade at 10 a . m . est ( 1500 gmt ) , nymex president j . robert collins sent a fax to nymex traders calling for the restrictions , effective immediately , on trades with enron .
" no floor member may accept any order placed directly to the trading floor by enron or an enron affiliate unless such floor member has received express written authorization from an exchange clearing member carrying an enron account that such clearing member agrees to accept any and all orders placed directly by enron , " the fax stated .
nymex lists futures and options on crude oil , natural gas , heating oil , unleaded gasoline , platinum and palladium . its comex subsidiary carries futures and options on gold , silver and copper .
copyright ? 2000 dow jones & company , inc . all rights reserved .
enron fallout continues to pressure bank sector bonds
by richard a . bravo
of dow jones newswires
11 / 29 / 2001
dow jones capital markets report
( copyright ( c ) 2001 , dow jones & company , inc . )
new york - ( dow jones ) - yield margins to treasurys on bank bonds continued to widen thursday as the aftershocks of the enron corp . ( ene ) debacle continued to affect the sector .
all three major ratings agencies lowered their ratings of the energy services company to junk status on wednesday , while dynegy inc . ( dyn ) pulled the plug on a potential acquisition of the company .
citigroup inc . ( c ) and j . p . morgan chase & co . ( jpm ) each have an estimated direct line exposure to enron of $ 500 million , according to a research report issued thursday by credit suisse first boston .
at the open thursday , j . p . morgan chase ' s 10 - year bonds were quoted at a spread of 132 basis points over treasurys . after moving out as wide as 139 basis points in morning dealings , they ratcheted back in to 134 basis points over treasurys by late morning .
citigroup ' s 10 - year paper opened the day at 112 basis points over treasurys . the outstanding debt widened out as far as 119 basis points over treasurys before moving back in to 116 basis points over treasurys .
on wednesday , spreads on citigroup and j . p . morgan debt widened 11 basis points while bank spreads in general were seven to eight basis points wider .
wells fargo 201 938 - 2087 richard . bravo @ dowjones . com
copyright ? 2000 dow jones 15 % annual earnings growth
11 / 29 / 2001
pr newswire
( copyright ( c ) 2001 , pr newswire )
steve malcolm says expected net exposure linked to enron to be less than
$ 100 million
tulsa , okla . , nov . 29 / prnewswire / - - steven j . malcolm , president and chief operating officer of williams ( nyse : wmb ) , said today he expects the company to meet or exceed all of its previously announced earnings targets .
" we are traditionally conservative in managing our risk , so we currently believe our net exposure related to enron will be less than $ 100 million , " malcolm said . " our expected earnings growth further validates our strategy of a balanced approach - - investing in strategic energy assets while deploying a marketing company that is focused on offering customers risk management products , versus relying on pure trading activities .
" we believe we are capable of growing our profitability in the years to come and remain enthusiastic about our business mix . we relish the opportunity to clearly establish our solid position to ultimately continue our demonstrated ability to deliver superior results to our shareholders , " he said .
malcolm said he believes the company will deliver recurring 2001 earnings per share of $ 2 . 40 and has the capacity to deliver an ongoing recurring earnings growth rate estimate of 15 percent or more per year .
about williams
williams , through its subsidiaries , connects businesses to innovative , reliable energy products and services . williams information is available at www . williams . com .
portions of this document may constitute " forward - looking statements " as defined by federal law . although the company believes any such statements are based on reasonable assumptions , there is no assurance that actual outcomes will not be materially different . any such statements are made in reliance on the " safe harbor " protections provided under the private securities reform act of 1995 . additional information about issues that could lead to material changes in performance is contained in the company ' s annual reports filed with the securities and exchange commission .
make your opinion count - click here
/ contact : media relations , jim gipson , + 1 - 918 - 573 - 2111 , or jim . gipson @ williams . com , or investor relations , rick rodekohr , + 1 - 918 - 573 - 2087 , or rick . rodekohr @ williams . com , or richard george , + 1 - 918 - 573 - 3679 , or richard . george @ williams . com , all of williams / 11 : 07 est
copyright ? 2000 dow jones & company , inc . all rights reserved .
enron mentions - 11 / 29 / 01
daschle calls for congressional investigation of enron collapse
bloomberg , 11 / 29 / 01
enron troubles hit houston office market ; tower project delayed
bloomberg , 11 / 29 / 01
newpower has enough cash to run through 2 nd quarter ( updatel )
bloomberg , 11 / 29 / 01
txu ' s taylor comments on effect of possible enron bankruptcy
bloomberg , 11 / 29 / 01
nymex tells members enron trades must be approved ( updatel )
bloomberg , 11 / 29 / 01
enron metals close to finding a buyer , administrators say
bloomberg , 11 / 29 / 01
german bank enron exposure between $ 9 million and $ 100 million
bloomberg , 11 / 29 / 01
enron corp . is poised to file largest - ever bankruptcy case
bloomberg , 11 / 29 / 01
enron ' s overseas assets could complicate bankruptcy
dow jones emerging markets report , 11 / 29 / 01
usa : ice electronic energy trade soars on enron woes .
reuters english news service , 11 / 29 / 01
unwind of enron derivatives could be mkt ' s biggest ever
dow jones capital markets report , 11 / 29 / 01
usa : us 10 - yr t - note up full point on weak data , enron .
reuters english news service , 11 / 29 / 01
reliant resources says enron situation manageable and presents opportunities
pr newswire , 11 / 29 / 01
enron european counterparties largely blase on exposure
dow jones energy service , 11 / 29 / 01
usa : u . s . stocks buoyed by corporate earnings .
reuters english news service , 11 / 29 / 01
enron troubles hand further ammunition to dollar bears
dow jones news service , 11 / 29 / 01
uk : uk prompt electricity dives on enron backlash .
reuters english news service , 11 / 29 / 01
enron didn ' t trade on swiss power market thursday
dow jones international news , 11 / 29 / 01
us power , gas markets remain orderly despite enron exit
dow jones energy service , 11 / 29 / 01
usa : enron opens eol trade system to unwind positions .
reuters english news service , 11 / 29 / 01
germany : german power jumpy , cal 02 up on enron crisis .
reuters english news service , 11 / 29 / 01
europe funds ' exposure to enron limited ; many sold early
dow jones international news , 11 / 29 / 01
enron metals trading staff say bnp , coke metals , hsbc rumoured possible buyers
afx news , 11 / 29 / 01
enron said to guarantee europe pwr delivery only thu , fri
dow jones energy service , 11 / 29 / 01
usa : dynegy cites deterioration in enron operations .
reuters english news service , 11 / 29 / 01
csfb : three big banks have $ 1 . 5 b loan exposure to enron
dow jones capital markets report , 11 / 29 / 01
usa : update 1 - daschle says congress needs answers on enron .
reuters english news service , 11 / 29 / 01
enron crisis hits four japanese money mgmt funds - nikkei
dow jones international news , 11 / 29 / 01
enron bonds signal anticipated enron bankruptcy filing
dow jones capital markets report , 11 / 29 / 01
usa : nymex restricts trading with enron .
reuters english news service , 11 / 29 / 01
enron fallout continues to pressure bank sector bonds
dow jones capital markets report , 11 / 29 / 01
williams president reaffirms 2001 earnings guidance ; 15 % annual earnings growth
pr newswire , 11 / 29 / 01
daschle calls for congressional investigation of enron collapse
2001 - 11 - 29 12 : 30 ( new york )
washington , nov . 29 ( bloomberg ) - - following are comments
made this morning by senate majority leader tom daschle when asked
about the collapse of enron corp . :
` ` we ' re certainly going to try to find answers to
the questions involving the collapse of enron . i don ' t know that
anybody knows yet just how this happened and how it happened so
quickly .
` ` i think we need to find as much information as is possible
and make some assessment about whether it ' s indicative of energy
in a larger context and if it is , what we ought to do about it .
but clearly it raises some very serious questions . ' '
enron troubles hit houston office market ; tower project delayed
2001 - 11 - 29 12 : 25 ( new york )
enron troubles hit houston office market ; tower project delayed
houston , nov . 29 ( bloomberg ) - - trammell crow co . delayed
construction of a $ 108 million office development in downtown
houston , the first real estate project in the city to suffer the
fallout from enron ' s financial troubles .
trammell crow delayed groundbreaking on the planned 34 - story
tower until at least next year , said leah rogers , a trammell crow
spokeswoman . construction was to have started next week .
` ` given the national economic uncertainty and the uncertainty
associated with the future availability of class ` a ' space
springing from the recent events at enron , we have decided to
delay our construction start until future visibility improves , ' '
matt khourie , who heads trammell crow ' s houston development
operations , said in a statement .
enron , the largest u . s . energy trader , may have to file for
bankruptcy protection and liquidate assets after dynegy inc .
abandoned its proposed purchase of the company , investors and
analysts said . with enron expected to give most of the 3 million
square feet it occupies in houston , developers will have a harder
time filling projects , forcing rental rates down , brokers said .
about 2 million square feet of enron ' s space is in the city ' s
downtown , where trammell crow ' s ballpark place project was
planned . the project was to include apartments and retail space ,
and sit next to enron field , home to the major league baseball
team houston astros , according to the houston chronicle , which
reported the delay earlier .
houston has 4 projects under construction , including a 40 -
story , 1 . 17 - million - square - foot tower being built by enron next to
its current headquarters . the projects are mainly being built for
power companies , said peyton collins , head of property broker
insignia / esg ' s houston office .
` ` the downtown market is 5 percent vacant and if you look
five years out , with all the space that ' s coming in line , vacancy
rates could double , ' ' said collins .
other houston office projects underway include an 800 , 000 -
square - foot building in which reliant resources will lease 550 , 000
square feet , and a 600 , 000 - square - foot tower , half of which will
be occupied by calpine corp . , according to insignia .
newpower has enough cash to run through 2 nd quarter ( updatel )
2001 - 11 - 29 12 : 36 ( new york )
newpower has enough cash to run through 2 nd quarter ( updatel )
( updates with financing details in second paragraph and
enron ' s third - quarter loss on investments in sixth paragraph . )
purchase , new york , nov . 29 ( bloomberg ) - - newpower holdings
inc . , a venture formed by enron corp . to compete with traditional
natural - gas and electric utilities , said it has enough cash and
credit to run through the second quarter .
the company is negotiating with lenders for $ 50 million for
next year and another $ 50 million in 2003 , spokeswoman gael doar
said . newpower , 44 percent owned by enron , may need money to buy
gas for winter inventories next year , she said .
newpower said a possible enron bankruptcy filing probably
won ' t affect its earnings . the purchase , new york - based company
said it can meet its credit obligations to enron and utilities and
will continue to deliver to customers .
newpower had 805 , 000 customers at the end of the third
quarter and said it expects to have 840 , 000 to 860 , 000 by the end
of the year . most electricity customers are in texas . georgia is
its largest gas market , doar said . it also has business in ohio ,
pennsylvania and elsewhere .
dynegy inc . yesterday abandoned its bid for rival enron , once
the biggest energy trader , after standard i ' m sure i can expect some of
that sort of stuff but nothing yet today . i ' m sure they ' ve got
other things to think about . ' '
nymex tells members enron trades must be approved ( updatel )
2001 - 11 - 29 12 : 47 ( new york )
nymex tells members enron trades must be approved ( updatel )
( adds margin increases in fourth - fifth paragraphs . )
new york , nov . 29 ( bloomberg ) - - new york mercantile exchange
president j . robert collins told floor members they could not
accept orders from enron corp . unless they receive written
authorization from an exchange clearing member .
a fax from collins to member firms today said the order was
effective immediately and that it would ` ` remain in effect until
further notice from the exchange . ' '
clearing members are companies that guarantee transactions on
the exchange , which trades energy and metals futures and options .
the exchange yesterday said it will raise margins on its
natural gas and crude oil futures contracts at the close of
trading today . margins are deposits traders must make with the
exchange when buying or selling futures contracts to ensure
obligations will be met .
while the exchange gave no reason for the increase , the
decision followed a day of wide changes in natural gas prices . the
swings began after dynegy inc . abandoned plans to purchase enron ,
once the biggest gas trader . traders grew concerned that enron
might be forced into bankruptcy .
enron metals close to finding a buyer , administrators say
2001 - 11 - 29 13 : 32 ( new york )
enron metals close to finding a buyer , administrators say
london , nov . 29 ( bloomberg ) - - enron corp . ' s metals unit , one
of the biggest traders on the london metal exchange , is close to
being sold , its administrator said , an accord that would end an 18 -
month foray into markets for copper and similar products .
possible buyers include hsbc holdings plc , glencore
international ag and the current management of the company ,
traders and analysts speculated . officials at the companies
couldn ' t immediately be reached for comment .
` ` there is already very serious interest in enron ' s metal
business , and negotiations are expected to lead to a successful
deal ' ' soon , said tony lomas , a pricewaterhousecoopers
administrator for enron in europe . ` ` our primary focus will be on
the large physical assets and trading position of the group . ' '
traders and analysts have speculated that enron metals would
be sold since dynegy inc . agreed earlier this month to buy enron
corp . for $ 23 billion . after that accord collapsed yesterday , the
metals unit seemed slated for a sale , analysts said .
enron agreed to buy the business , formerly mg plc , for $ 445
million in may of last year . mg itself was the metals - trading unit
of germany ' s metallgesellschaft ag and a century - old operation
upon which that german construction , engineering and trading
company was built .
it is one of just 11 floor traders on the london metal
exchange , the world ' s biggest metals bourse . enron earned
commissions though brokering trades there , charged rent at its
warehouses owned by henry bath & son ltd . and speculated on the
direction of metals prices .
declining market
the former chief executive of metallgesellschaft , heinz
schimmelbusch , in an interview earlier this month denied
speculation that his pennsylvania - based safeguard international
fund lp was interested in buying enron or any metals - trading
operation .
hsbc , europe ' s biggest bank by market value , said last month
it ' s considering a plan to add trading of industrial metals such
as copper and aluminum to its precious - metals trading operation to
meet demand from its customers .
any interest from glencore may stem from its desire to expand
its existing operations , said mike price , head of mining and
metals at societe generale , which is itself a so - called ring
dealer , or floor trader , on the lme .
whoever buys enron metals ` ` has to be somebody pretty
substantial , ' ' price said . if the current management hopes to be
the buyer , ` ` they would need to find somebody with deep pockets . ' '
the new owner of enron metals will be entering the metals
market at a time when copper prices have declined 15 percent this
year and aluminum prices are 7 percent down as demand dropped from
users such as aircraft makers and electronics companies amid
slowing economies .
the declining prices have led n . m . rothschild & sons , a
member of the lme , to quit base metals trading and prompted
scotiamoccata , a metals - trading unit of canada ' s bank of nova
scotia to leave the lme ring .
the departure of scotiamoccata reduced the number of ring
dealers to 11 and raised doubts about the future of open - outcry
trading at the exchange . the lme is promoting less - expensive
electronic trading .
german bank enron exposure between $ 9 million and $ 100 million
2001 - 11 - 29 13 : 32 ( new york )
german bank enron exposure between $ 9 million and $ 100 million
frankfurt , nov . 29 ( bloomberg ) - - dresdner bank ag , which is
owned by allianz ag , said its exposure to enron corp . is about
$ 100 million .
deutsche bank ag and commerzbank ag said their exposure to
enron amounts to a ` ` double - digit ' ' million euros amount .
europe ' s largest bank has an exposure ` ` significantly ' ' below
100 million euros ( $ 89 million ) , said ronald weichert , a spokesman
for deutsche bank .
commerzbank ' s exposure is more than 10 million euros and less
than 50 million euros , spokesman peter pietsch said .
dresdner expects ` ` way less ' ' than $ 100 million to default ,
and will take the appropriate loan loss reserves at the end of the
year , said spokeswoman elke pawellek .
the largest u . s . energy trader , may file for bankruptcy
protection after dynegy inc . yesterday abandoned its proposed
merger with enron , forcing enron to liquidate assets to pay some
of its $ 15 billion in publicly held debt .
enron corp . is poised to file largest - ever bankruptcy case
2001 - 11 - 29 14 : 04 ( new york )
enron corp . is poised to file largest - ever bankruptcy case
washington , nov . 29 ( bloomberg ) - - enron corp . is poised to
file the largest bankruptcy reorganization in history after dynegy
inc . scuttled plans to acquire the energy trader that is saddled
with more than $ 15 billion in debt .
enron , with less than $ 2 billion in cash as of last week ,
must pay $ 690 million to lenders by mid - december and is
responsible for another $ 3 . 9 billion in debt owed by affiliated
partnerships .
the houston - based company ' s collapse was underscored by new
restrictions on its operations . the new york mercantile exchange
barred floor members from accepting orders from enron without
special written authorization , and the company ' s internet trading
was reduced from about 30 commodities to three products .
a bankruptcy filing by enron would top texaco inc . ' s record
$ 35 . 9 billion case in 1987 , with creditors lining up to claim
what ' s left of the company ' s more than $ 61 billion in assets .
` ` it ' s a black hole , ' ' said gary hindes , managing director of
deltec asset management llc , which has no investment in enron .
` ` until the forensic accountants can get in there and sort things
out , you just don ' t know what enron ' s worth . ' '
duke energy corp . , j . p . morgan chase & co . , williams cos . and
a dozen other companies say they may lose more than $ 1 billion
combined from enron ' s collapse . electricity and natural gas
companies said enron owed them almost $ 600 million as of
yesterday .
in london , was appointed administrator
of enron ' s european holding company and some of its operating
companies , a step other companies have taken before filing chapter
11 papers in the u . s .
enron shares have lost more than $ 26 billion in market value
in the last six months .
lawyers
enron has hired the law firm weil gotshal & manges llp , which
has the nation ' s largest bankruptcy practice , and the blackstone
group lp investment banking firm . arthur newman , head of
restructuring at blackstone , said his firm was retained but
declined to comment further .
chapter 11 would let enron officials continue to control the
company while negotiating a recovery plan with creditors . a
provision of u . s . bankruptcy law automatically blocks debt -
collection efforts , lawsuits and other actions against the
company .
` ` a chapter 11 filing can be a great thing for a cash - starved
company being attacked from all sides , ' ' said nancy rapoport , dean
of the university of houston law center .
thousands affected
an enron bankruptcy would affect thousands of people ,
including the company ' s 21 , 000 employees , its customers ,
suppliers , investors and other creditors . the court - supervised
recovery process would give enron a chance to change strategies
and fix mistakes . it might take years to complete and may end in
the company ' s liquidation .
in addition to its energy trading operation , enron operates a
nationwide gas pipeline system spanning 25 , 000 miles . it also owns
portland general electric , which generates and distributes power
to about 725 , 000 customers in the pacific northwest . the company ' s
enron broadband services is building a global fiber - optic
communications network .
chapter 11 reorganization lets companies abandon onerous
contracts and unprofitable leases .
` ` every bad business deal enron got into they ' ll walk away
from , ' ' said peter chapman , a distressed - debt investor who also
publishes newsletters on high - profile bankruptcy reorganizations .
recovery
the goal in chapter 11 is a recovery plan that allows a
company to pay creditors and come out of bankruptcy . a plan
typically must be approved by a majority of creditors representing
two - thirds of a company ' s debts . then a company would ask a
bankruptcy judge for final approval .
the recovery plan divides a company ' s value among various
classes of creditors . under a hierarchy set by the u . s . bankruptcy
code , secured creditors - - those with collateral backing their
claims - - are paid ahead of unsecured creditors , such as
bondholders and suppliers .
financial advisers to creditors and companies in large
bankruptcies say a chapter 11 recovery plan for enron would be
particularly difficult to produce .
` ` you have a host of intangible assets combined with a morass
of contingent liabilities creating a potential witches ' brew of a
bankruptcy , ' ' said jeff werbalowsky of houlihan lokey howard &
zukin , an investment banking firm that has been contacted for
advice by enron bondholders .
shareholders
enron ' s shareholders are likely to lose all of their
investment in a chapter 11 case because they would be last in line
to get paid .
enron shares fell 20 cents , or 33 percent , to 41 cents in
afternoon trading . the shares traded at $ 54 . 54 on june 4 . the
company said this morning it was evaluating whether it will pay a
scheduled 12 . 5 - cent quarterly dividend on dec . 20 .
enron ' s bond prices reflect the uncertainty about the
company ' s value . the company ' s 6 . 4 percent notes that mature in
2006 were unchanged at about 22 cents on the dollar , traders said .
at that price the notes yield 53 percent .
some recovery for enron creditors in a bankruptcy case may
come from lawsuits , said russell a . belinsky , an investment banker
with chanin capital partners , which also has been approached for
advice by enron bondholders .
` ` there ' s a lot of juicy legal issues , ' ' said belinsky .
potential targets include enron ' s accounting firm and its officers
and directors .
` ` disentangling all the pieces in a reorganization is going
to be a painstaking job , ' ' he said .
liability
dynegy might face some liability for canceling its purchase
of enron . dynegy invoked terms of the buyout agreement that gave
it the right to purchase an enron natural gas pipeline if the
takeover fell apart . dynegy received the right to the pipeline in
exchange for a $ 1 . 5 billion investment in enron by chevrontexaco
corp . , which owns one - fourth of dynegy .
enron might use bankruptcy to prevent dynegy from walking
away from the buyout and claiming ownership to the pipeline .
the dynegy acquisition , valued at $ 23 billion when it was
proposed on nov . 9 , collapsed as bankers failed to raise the $ 1 . 5
billion enron needed to operate until the deal was completed . the
lack of funds and a credit downgrade contributed to dynegy ' s
decision .
bankers led by j . p . morgan chase & co . vice chairman james b .
lee tried for two weeks to raise the cash enron needed . investors
turned them down because of heightened concern enron wouldn ' t be
able to pay its debts .
three credit - rating agencies yesterday cut enron ' s credit
rating to junk status , triggering an acceleration of the company ' s
debt obligations .
unraveling
enron ' s unraveling began in october after it said
shareholders ' equity was reduced by $ 1 . 2 billion because of the
way the company accounted for outside partnerships it created . the
announcement prompted lawsuits and an investigation by the u . s .
securities and exchange commission , and enron ended up restating
earnings for almost five years .
as shares plunged , enron ' s trading partners lost confidence
the company would have the cash to pay bills . trading partners
such as mirant corp . either demanded more collateral to trade or
restricted trading with the company .
` ` the situation is dire , ' ' said deltec ' s hindes . ` ` no one ' s
going to trade with enron right now because you could wind up
being an unsecured creditor tomorrow . ' '
enron ' s overseas assets could complicate bankruptcy
by charles roth
of dow jones newswires
11 / 29 / 2001
dow jones emerging markets report
( copyright ( c ) 2001 , dow jones & company , inc . )
new york - ( dow jones ) - as enron corp . ( ene ) teeters on the edge of insolvency , its creditors , power industry players and even foreign governments are angling to lay claim to the company ' s assets .
in an example of how far the ripples are being felt , the brazilian government said thursday it ' s legally entitled to seize enron ' s assets in that country if the u . s . energy titan files for bankruptcy .
the houston - based company has more than $ 60 billion in assets , a little more than 10 % of which are considered " non - core " or located overseas . indeed , of enron ' s 10 , 453 megawatts in total power production , 8339 mw are generated internationally .
as it established a presence in dozens of countries , enron also diversified into oil and gas exploration and production , power generation , and even non - energy related businesses such as forest products , metals and steel , broadband and credit evaluation systems .
although enron ' s non - core and global forays haven ' t on the whole been profitable , there is value in some of the hard assets .
and while it ' s not clear whether or how claims by foreign governments on enron assets would be honored , it ' s certain the company ' s myriad overseas holdings will further addle what would likely be a vastly complex bankruptcy proceeding .
the following is an overview of a number of those holdings outside the north american continent , according to some of the most recent data provided by the company , which didn ' t , however , specify the extent of its equity interests or operational control in the majority of the assets listed .
approximately 70 % of enron ' s assets outside north america and europe are located in central and south america and the caribbean :
- - - brazil : enron controls electricity distributor elektro eletricidade e servico sa ( e . eko ) , which was acquired in 1998 for brrl . 479 billion ( $ 1 = brr 2 . 48 ) . it also owns two gas - fired thermoelectric plants : eletrobolt , with a capacity of 380 megawatts , and cuiaba , with a 480 - mw capacity .
enron also owns important stakes in natural gas distributor companhia distribuidora de gas do rio de janeiro ( e . cdr ) , or ceg , and its smaller unit ceg - rio .
in late april , brazil ' s oil giant petroleo brasileiro ( pbr ) , or petrobras , agreed to pay $ 240 million for the stake enron owns in ceg . petrobras agreed to buy the 25 . 38 % stake the u . s . energy group owns in ceg as well as the 33 . 75 % stake enron has in ceg - rio . the deal is still seen closing in the next few days .
- - - puerto rico : enron has been poised to sell in the weeks ahead a 49 % interest in the 507 mw ecoelectrica power plant and liquified natural gas terminal for about $ 250 million .
it ' s also involved in a 20 , 000 metric ton liquefied petroleum gas storage terminal and the san juan gas distribution company , which has a capacity to carry approximately 400 , 000 cubic feet a day .
- - - bolivia : enron is an operator on the bolivian side of the 3 , 000 kilometer bolivia - to - brazil natural gas pipeline , and holds a small 4 % interest on the brazilian side .
- - - argentina : enron has an interest in transportadora de gas del sur , a 5 , 005 kilometer pipeline .
- - - venezuela : enron , in cooperation with vengas , is involved in a leading transporter and distributor of lpg , among other assets .
- - - colombia : enron has stakes in the centragas pipeline , a 578 km natural gas transmission system , and promigas , a top natural gas company .
- - - panama : enron holds a 355 mw electricity generation plant .
- - - guatemala : enron has two power plants with combined generating capacity of 234 mw .
- - - dominican republic : enron has a 185 mw power facility .
the company also has a sizeable footprint in asia , particularly in india :
- - - india : about 14 % of enron ' s international assets are located in india , home to its mammoth $ 3 billion dabhol power project , which has a generation capacity of 2184 mw .
enron is also poised to sell its offshore india oil 201 - 938 - 2226 ; charles . roth @ dowjones . com
( geoffrey smith in london contributed to this article . )
copyright ? 2000 dow jones & company , inc . all rights reserved .
usa : ice electronic energy trade soars on enron woes .
11 / 29 / 2001
reuters english news service
( c ) reuters limited 2001 .
new york , nov 29 ( reuters ) - the intercontinental exchange ( ice ) , an atlanta - based electronic energy and metals marketplace , said on thursday that trade on its system in late november was up 65 percent from october .
ice has been setting new trading records in recent weeks , as concerns over energy trader enron corp . ' s crumbling credit rating diverted on - line business to the exchange .
enron suspended operations of enrononline , ice ' s main rival for internet - based trading , on wednesday after standard & poor ' s cut enron ' s credit rating to " junk " status , killing a potential takeover by dynegy inc . .
enron , which said it has no plans to permanently dismantle its electronic trading system , said it reopened enrononline thursday to allow parties to unwind outstanding positions .
until this month , enron was by far the nation ' s largest trader in north american natural gas and electricity , with industry analysts estimating it was involved in some 25 percent of all daily trade in those markets .
in addition to increased volumes , ice has also seen a big jump in the number of users tapping into the system , up 30 percent from october , the exchange said in a statement .
" over the past couple of weeks we have experienced an increase in total volumes and registered users , " said jeffrey sprecher , chief executive officer of ice .
" we believe the inherent credit concerns in the otc ( over - the - counter ) market have spawned interest in a many - to - many trading platform as opposed to a one - to - many platform .
sprecher also said ice would continue to look for ways to expand its trading platform to accommodate new participants .
as an open - access marketplace , intercontinental exchange now has over 400 commodity trading firms participating .
the ice electronic trading system is now installed on over 7 , 500 desktops worldwide , a 7 percent gain in the past two weeks .
products traded on ice include natural gas , power , crude oil and refined products , precious metals and emissions allowances .
intercontinental exchange has offices in new york , houston , chicago , london and singapore and is owned by over 100 energy and metals traders , brokers and bankers .
copyright ? 2000 dow jones & company , inc . all rights reserved .
unwind of enron derivatives could be mkt ' s biggest ever
by joe niedzielski
of dow jones newswires
11 / 29 / 2001
dow jones capital markets report
( copyright ( c ) 2001 , dow jones joe . niedzielski @ dowjones . com
copyright ? 2000 dow jones & company , inc . all rights reserved .
usa : us 10 - yr t - note up full point on weak data , enron .
11 / 29 / 2001
reuters english news service
( c ) reuters limited 2001 .
new york , nov 29 ( reuters ) - u . s . benchmark 10 - year notes soared more than a full point on thursday as a broad treasury market rally on hopes for another federal reserve rate cut extended amid concerns the beleaguered energy - trading company enron will soon file for bankruptcy .
enron corp . stood at the abyss of bankruptcy on thursday , as its european arm filed for creditor protection and creditors assessed their exposure to one of the world ' s biggest - ever corporate collapses .
" it looks like enron is going to file bankruptcy , " said jim claire , head of fixed income trading at evergreen institutional asset management in charlotte , north carolina . " this is kind of a flight to quality . "
an early report showing a spike in weekly jobless claims in the past week highlighted the frail u . s . economy , boosting market expectations that the fed will cut interest rates for the 11 th time this year at its policy meeting on december 11 .
at 1 : 13 p . m . ( 1813 gmt ) , two - year notes were up 8 / 32 to 100 - 1 / 32 , yielding 2 . 96 percent . five - year notes climbed 22 / 32 to 97 - 3 / 32 , yielding 4 . 15 percent . benchmark 10 - year notes were up 30 / 32 to 101 - 14 / 32 , yielding 4 . 81 percent . thirty - year bonds were up 1 - 15 / 32 to 101 - 24 / 32 , yielding 5 . 26 percent .
.
copyright ? 2000 dow jones & company , inc . all rights reserved .
reliant resources says enron situation manageable and presents opportunities
11 / 29 / 2001
pr newswire
( copyright ( c ) 2001 , pr newswire )
houston , nov . 29 / prnewswire / - - reliant resources , inc . ( nyse : rri ) today announced that it is confident that the wholesale energy markets will work through the implications caused by enron ' s recent credit rating downgrade . because the deterioration in enron ' s credit position has occurred over a period of weeks , the market and reliant resources have had opportunities to prepare for such an event . reliant resources ' current exposure to enron is approximately $ 80 million , primarily from power sales from the company ' s asset portfolio and natural gas sales from its trading portfolio .
reliant resources has already seen additional market opportunities as a result of the situation and is increasing its efforts to serve new and existing customers .
reliant resources , based in houston , texas , provides electricity and energy services to wholesale and retail customers in the u . s . and europe , marketing those services under the reliant energy brand name . the company has nearly 18 , 000 megawatts of power generation capacity in operation , under construction or advanced development , or under contract in the u . s . reliant resources is one of only five companies to rank among both the ten largest power marketers and the ten largest natural gas marketers in north america . the company also has wholesale trading and marketing operations and nearly 3 , 500 megawatts of power generation in operation in western europe . at the retail level , reliant resources provides energy services and will serve approximately 1 . 7 million customers in texas when the electricity market opens to full retail competition in january 2002 . reliant resources currently is a majority - owned subsidiary of reliant energy ( nyse : rei ) .
this news release includes forward - looking statements . actual events and results may differ materially from those projected . factors that could affect actual results include the timing and impact of future regulatory and legislative decisions , changes in reliant resources ' business plans , financial market conditions and other factors discussed in reliant resources ' filings with the securities and exchange commission .
make your opinion count - click here
/ contact : media , sandra fruhman , + 1 - 713 - 207 - 3123 , or investors , dennis barber , + 1 - 713 - 207 - 3042 , both of reliant resources , inc . / 13 : 13 est
copyright ? 2000 dow jones & company , inc . all rights reserved .
enron european counterparties largely blase on exposure
by mark long
of dow jones newswires
11 / 29 / 2001
dow jones energy service
( copyright ( c ) 2001 , dow jones & company , inc . )
london - ( dow jones ) - three major spot power market exchanges suspended enron corp . ' s ( ene ) right to trade thursday , but the one - time energy giant ' s major european counterparties were more relaxed about their exposure to the company , indicating they had made full use of the breathing space afforded by dynegy inc . ' s ( dyn ) unsuccessful rescue bid .
ukpx banned enron from spot power trade thursday because it defaulted on contracts . nord pool suspended enron ' s trading rights because enron failed to meet margin requirements . apx declined to comment on why enron was suspended from u . k . trade . spanish pool operator omel was unavailable to comment on enron ' s status as a market participant in spain .
statements by leading u . k . and german companies hint that energy companies without balanced portfolios of assets may see the biggest problems on the back of the enron debacle .
u . k . multi - utility innogy plc ' s ( iog ) chief executive brian count told journalists early thursday his company wasn ' t overexposed to the defunct energy trader , although he declined to comment on innogy ' s level of exposure .
" from where i sit , there ' s one less competitor and still the same number of customers who want risk management services , " count told journalists in a telephone conference call following the release of innogy ' s first - half results .
" we ' ve had enron under review for last five weeks , " he added . " we ' ve actively managed that situation and as a company we ' re comfortable with our position with enron . we ' ll regard it as an opportunity . "
powergen plc ( pwg ) , the u . k . power giant , said it isn ' t overexposed to enron and anticipates no negative change in its market position if enron goes bankrupt .
" powergen manages risk in such a way that there will not be any negative material impact on us if enron becomes insolvent , " said a spokeswoman for powergen .
industry sources say powergen was among the first to stop trading with enron , and the company is generally highly credit - conscious .
spokesmen at both scottish power plc ( spi ) and scottish dow jones newswires ; + 44 ( 0 ) 20 7842 9356 ; mark . long @ dowjones . com
copyright ? 2000 dow jones so we are doing a little bit better but it just feels like you are not going to really explode to the upside at all , " said todd clark , co - head of equity trading at wr hambrecht . " the market is just going to sit here for a while , it will continue to correct the rally that we had . markets don ' t go up in a straight line . "
the technology - laced nasdaq composite index rose 27 . 01 points , or 1 . 43 percent , to 1 , 914 . 98 . the blue chip dow jones industrial average was up 32 . 24 points , or 0 . 33 percent , at 9 , 744 . 10 . the broader standard & poor ' s 500 index was up 5 . 84 points , or 0 . 52 percent , at 1 , 134 . 36 .
among active nasdaq stocks , palm rose after the hand - held computer maker said it expects to meet analysts ' estimates . palm rose 15 cents to $ 3 . 56 , or 4 . 4 percent .
software provider freemarkets inc . rose sharply on the nasdaq after it raised its revenue and profit outlook . freemarkets jumped $ 3 . 98 to $ 17 . 57 , 29 . 2 percent .
storage networking company brocade communications systems inc . rose $ 2 . 43 to $ 31 . 25 on the nasdaq . its profits fell sharply as the slower economy kept corporate buyers on the sidelines but still managed to meet wall street ' s estimates .
enron , teetering on the brink of one of the biggest corporate implosions in u . s . history , plunged 85 percent in frenzied trading wednesday and fell 34 . 4 percent , off 20 cents at 41 cents on the new york stock exchange . it sank as low as 35 cents initially .
enron was crushed by rival dynegy inc . ' s decision to pull out of its planned $ 9 billion takeover of the beleaguered energy trader .
the s & p natural gas index lost nearly 4 percent at one point but later cut losses . thursday ' s drop reflected losses in other firms such as williams cos . inc . , down $ 1 to $ 26 . 05 . dynegy fell 87 cents to $ 35 . 02 .
" enron went from a done deal to a dead deal , " said alan ackerman , market strategist with brokerage fahnestock & co . " the enron collapse may have significant ramifications on banks and other energy companies where contracts with enron may now not be honored . and the enron equity may be worthless . "
financial giants citigroup inc . and j . p . morgan chase & co . inc . , which lent money to the proposed enron - dynegy merged company , saw their stocks fall for a second day running but later rebounded . citigroup rose 51 cents to $ 48 . 31 and j . p . morgan rose 5 cents to $ 37 . 55 . both are components of the dow index .
nvidia corp . soared after standard & poor ' s said the multimedia graphics firm will replace energy trade enron in the s & p index of 500 top companies . nvidia soared $ 3 . 24 to $ 54 . 60 , or more than 6 percent .
sales of new u . s . homes rose for the second straight month in october , inching up 0 . 2 percent to an annual rate of 880 , 000 units , suggesting the housing market continues to be a bright spot in the ailing u . s . economy .
orders for costly u . s . durable goods surged at the fastest rate on record in october by 12 . 8 percent to $ 184 . 8 billion , the largest gain since the commerce department began records in march 1992 . the increase was led by huge orders for aircraft and defense capital goods as well as cars . the data may help rekindle hopes that the economy has rebounded since the sept . 11 attacks .
orders for motor vehicles , which were likely spurred on by increased demand due to zero interest rate loans for car purchases , jumped 10 . 6 percent .
but the number of americans lining up for first - time jobless benefits rose by 54 , 000 last week , exceeding wall street expectations .
" we saw an encouraging number in the durable goods but it ' s too early to see this as a sustained trend up and layoffs continue to be a real concern , " ackerman added .
h & r block inc . , the no . 1 u . s . tax preparer , rose $ 2 . 22 to $ 38 . 22 , or more than 6 percent . the company raised its profit forecasts for the current fiscal year helped by new accounting rules and strong mortgage business .
conexant systems inc . rose after saying it expects revenue for the december quarter to be 5 percent to 7 percent above the prior quarter ' s , driven by strong demand for chips used in wireless devices like mobile phones . its stock rose 53 cents to $ 15 . 60 , or 3 . 5 percent .
acambis plc ' s american depositary receipts shot higher on news the u . s . government awarded the british company , along with baxter international inc . , a $ 428 million smallpox vaccine contract .
acambis adrs rose $ 7 . 3 to $ 45 , or 19 . 3 percent , and baxter shares rose $ 1 . 74 $ 51 . 90 . bioreliance corp . was up 8 percent , or $ 2 . 14 to $ 28 . 19 , after the company said it would help acambis produce the vaccines under the huge contract .
copyright ? 2000 dow jones & company , inc . all rights reserved .
enron troubles hand further ammunition to dollar bears
by grainne mccarthy
of dow jones newswires
11 / 29 / 2001
dow jones news service
( copyright ( c ) 2001 , dow jones 201 - 938 - 2381 ;
grainne . mccarthy @ dowjones . com
copyright ? 2000 dow jones & company , inc . all rights reserved .
uk : uk prompt electricity dives on enron backlash .
11 / 29 / 2001
reuters english news service
( c ) reuters limited 2001 .
london , nov 29 ( reuters ) - british day - ahead electricity prices slumped on thursday as traders dumped power onto the market after cutting ties with troubled enron .
day - ahead electricity was trading down to 15 pounds per megawatt hour from 26 . 5 pounds on wednesday .
" certain parties have cut lines with counter parties and have ended up having to dump electricity on the market , " said one trader .
the electricity flooding the prompt market is power which would have gone to enron and is likely to be generated from plants which cannot easily be switched off , such as nuclear power stations .
enron ' s european business was placed into administration on thursday as its parent stands on the brink of bankruptcy after a rescue deal with smaller rival dynegy fell apart .
in forward curve trading prices for the summer 02 baseload contract finished 10 pence higher 17 . 39 pounds and winter 02 baseload was down ten pence at 19 . 25 pounds , traders said .
traders said companies could start terminating contracts with enron under the terms of the over - the - counter market ' s standard gtma contract . a clause in the gtma allows immediate termination should a counterparty become insolvent .
copyright ? 2000 dow jones & company , inc . all rights reserved .
enron didn ' t trade on swiss power market thursday
11 / 29 / 2001
dow jones international news
( copyright ( c ) 2001 , dow jones + 41 1 211 70 1 ; goran . mijuk @ dowjones . com
copyright ? 2000 dow jones & company , inc . all rights reserved .
us power , gas markets remain orderly despite enron exit
by dina o ' meara , mark golden and andrew dowell
of dow jones newswires
11 / 29 / 2001
dow jones energy service
( copyright ( c ) 2001 , dow jones & company , inc . )
new york - ( dow jones ) - trading in u . s . natural gas and electricity markets generally remained orderly thursday , and price movements continued to be muted , despite the exit of one - time market leader enron corp . ( ene ) .
some gas markets , however , saw more volatility as a result of enron ' s absence , traders said , and some electricity prices seemed stronger than justified by fundamentals , perhaps a result of buying by traders covering their exposure to enron . the moves weren ' t dramatic .
" it ' s almost business as usual , " one power trader said .
enron wasn ' t presenting a full range of prices on its internet - based platform enrononline thursday , although traders said enron was briefly making markets for some products .
traders , who for the most part aren ' t doing business with the company , attributed the activity to last - minute efforts by some energy companies to flatten their positions with enron and the energy giant ' s own efforts to close its positions .
" there ' s a lot of unwinding going on , " a trader said .
the new york mercantile exchange , the world ' s largest energy futures exchange , advised its floor members thursday morning not to accept orders placed directly to the trading floor by enron or enron affiliates without written authorization from a clearing member carrying an enron account .
the exit of a company that once accounted for a quarter of the north american power and gas markets has produced substantial changes in the way business is done in the energy markets .
traders used to transacting on enrononline were spending more time on the phone or turning to platforms like that run by , an electronic marketplace founded by a consortium of energy and financial companies . traders accustomed to looking to enrononline for pricing guidance were left to figure out the market for themselves .
the result was abnormally high volatility in the physical gas markets , particularly on gas for delivery in the next month , a trader said .
gas for delivery in december at southern california ' s topak hub was trading in a range of $ 1 . 95 to $ 2 . 55 per million british thermal units , the trader said . december gas at the san juan basin was trading at $ 1 . 70 - $ 2 . 44 .
" traders aren ' t sure where they should be trading , " the trader said .
copyright ? 2000 dow jones & company , inc . all rights reserved .
usa : enron opens eol trade system to unwind positions .
11 / 29 / 2001
reuters english news service
( c ) reuters limited 2001 .
san francisco , nov 29 ( reuters ) - beleaguered energy giant enron corp . said on thursday it had reopened its widely used electronic trading system to allow parties to unwind outstanding positions .
the company also said it has no plans to permanently dismantle its enrononline ( eol ) system , which until this month was by far the most liquid marketplace for trading north american electricity and natural gas .
" enrononline is now available to our customers to transact only in order to provide a means to manage enron credit exposure , " a message posted on the trading system said .
the message warned that " while transactions may be available , customers entering into transactions should carefully evaluate their positions and enron ' s current credit status before transacting . "
enron spokesman eric thode confirmed enrononline - which recently accounted for up to 60 percent of enron ' s business - restarted operations late wednesday .
the internet - based eol trading platform was shut earlier wednesday after credit rating agencies cut enron ' s debt to " junk " status .
thode also said the company had " no plans " to cease operations on enrononline after parties have closed all outstanding positions .
the system also carries products for trading various commodities like metals , pulp and paper .
enron is teetering on the brink of bankruptcy after a rescue deal with its smaller rival , dynegy inc . , fell apart on wednesday .
copyright ? 2000 dow jones & company , inc . all rights reserved .
germany : german power jumpy , cal 02 up on enron crisis .
11 / 29 / 2001
reuters english news service
( c ) reuters limited 2001 .
frankfurt , nov 29 ( reuters ) - german electricity prices jumped around widely on thursday , while year 2002 firmed by up to 35 eurocents due to uncertainty over the value of long - term contracts with crisis - hit counterparty enron .
enron ' s liquidity crisis reached a head on thursday when the firm announced that its european arm had filed for creditor protection .
" prices were jumpy today , which was in part due to uncertainty with enron , " a trader said .
" but enron has actually been tapering off its volumes further out for a while now , so the market didn ' t really miss any big volumes from them today , " he added .
day ahead baseload traded at 31 . 5 - 33 euros , with an early high of 35 euros and a mid - session low of 29 . 5 euros , while peakload traded at 39 . 75 - 42 . 25 euros , after peaking at 45 euros and troughing at 39 . 75 euros .
week ahead was rangebound at 29 . 75 - 31 euros , while peakload changed hands at 41 . 5 - 44 euros in quiet trading .
december baseload traded at 27 . 6 euros , before retracing to its wednesday range of 26 . 65 - 26 . 7 euros , while january baseload traded at 26 . 65 - 27 . 1 , also steady with previous levels .
year 2002 firmed to 22 . 75 from 22 . 4 euros , before falling back down to 22 . 45 and last traded at 22 . 35 - 55 .
" this was all on speculation about enron and on covering their long - term postions since delivery is now not guaranteed beyond friday , " a dealer said .
copyright ? 2000 dow jones many sold early
by ellen thalman
of dow jones newswires
11 / 29 / 2001
dow jones international news
( copyright ( c ) 2001 , dow jones & company , inc . )
berlin - ( dow jones ) - while some european mutual funds may be stuck holding enron inc . ( ene ) shares or bonds , their exposure appears fairly limited , with a number of fund companies saying they already sold off their holdings in recent months .
nevertheless , a few funds said they had some exposure in stock or bonds to the company , which stopped most trading wednesday after standard & poor ' s downgraded its credit rating to " junk " and dynegy inc . ( dyn ) abandoned plans for a buyout .
fund manger helle bendorff with bg invest in copenhagen said at the end of october , bg invest ' s international corporate bond fund had 6 . 1 million kroner , or 3 . 2 % , invested in enron corporate bonds , out of a total fund of dkkl 95 million ( $ 1 = dkk 8 . 3652 ) .
" naturally when something like this happens anyone can see it will take its toll on returns , " said bendorff . however , she wouldn ' t give further details .
enron ' s 4 3 / 8 bonds dated 2005 were trading around 20 cents to the dollar thursday , down from over 50 cents before the buyout fell through . the collapse of the dynegy deal leaves enron bondholders holding about $ 13 billion in debt versus an unknown base of assets .
analysts widely expect enron to file for insolvency protection , and its liquidation value will be the focus for bondholders . bondholders are therefore more likely to get something back than investors who are left holding stocks .
in contrast with u . s . counterparts , most european stock funds ' exposure appears fairly low , however , and any hit to their value was probably already taken in the last months .
fund managers and spokespeople at a number of european fund houses that had been known to have holdings in enron shares in the past said they sold off those assets in recent months and weeks .
a spokesman at dutch funds company ohra beleggingen beheer bv said the fund sold its enron holdings at the end of october . they had comprised around 4 . 7 % of its eur 20 million new energy fund and were also included in some other funds , according to funds tracking company morningstar . he said they took a loss on the investment , but stressed they still unwound their holdings on time .
a fund manager at denmark ' s uni - invest said the firms electronic business unit trust had sold off its holdings in enron prior to the current troubles . as of the end of september the unit trust had held 3 . 6 % of its assets in enron stock . the size of the unit trust is dkk 585 million , the manager said .
dresdner bank ' s dit funds arm also sold off all its enron holdings in its energie fonds after the company ' s third - quarter earnings report , a spokesman said , as did ubs ' ag ' s ef - energy fund .
european energy funds tend to be rather small , so even if the fund is highly exposed , it ' s unlikely to have any market impact . the largest energy funds are only several hundred million euros , for example .
in the u . s . , the picture was somewhat different .
enron may have been held by some major u . s . funds , according to the funds ' most recent securities and exchange commission filings . those include fmr corp . ' s ( x . fin ) fidelity investments , stilwell financial inc . ' s ( sv ) janus capital corp . , alliance capital management ( ac ) and putnam investments . vanguard group inc . ( x . vgi ) held the stock in various portfolios , including its giant passively managed index funds , according to its filings .
the $ 11 billion alliance premier growth fund had about 4 % of its assets in enron shares as of sept . 30 , according to morningstar . based on the sept . 30 filing , the fund ' s stake had dropped in value by about $ 445 million through wednesday . a spokeswoman for janus said the company ' s mercury fund , which had 3 . 6 % of its assets invested in enron stock on april 30 , had disposed of all its enron shares by mid - november .
many of the stock funds in europe that are still holding enron funds also reduced their weightings considerably in recent months , according to their representatives .
a spokesman for u . k . - based investec said the company is still holding some enron stock , but wouldn ' t give specific data . morningstar listed the global privatization fund and the wired index fund as holders of enron stock , but investec ' s web site doesn ' t list the funds in the top 10 holdings .
" our enron positions in each of these funds is less than 3 % - it ' s a non - material exposure . we cut our loss positions about two months ago , and we were underweight even before that for a year now , " he said . " the wired index fund tracks the wired index ( a u . s . new - economy index ) and enron is a constituent of that , so our holding is the constituent portion . "
separately , standard and poor ' s said enron will be removed from its sdow jones newswires ; 49 - 302888410
( anita greil , xueling lin , neil moorhouse , nisha gopalan and henry j . pulizzi contributed to this story . )
copyright ? 2000 dow jones & company , inc . all rights reserved .
enron metals trading staff say bnp , coke metals , hsbc rumoured possible buyers
11 / 29 / 2001
afx news
( c ) 2001 by afp - extel news ltd
new york ( afx ) - enron corp ' s metal trading division has sparked some interest from potential buyers with rumours from the company ' s own trading floor putting bnp paribas , coke metals group , hsbc banking group and goldman sachs & co inc in the frame , an enron metals trader said .
he added that employees have not yet received any information from management on the future of the troubled energy giant following news from london this morning that enron ' s european office has gone into administration .
" everybody showed up for work today , it ' s still a working entity but we ' ve had no word , no internal memos as yet , " the employee told afx news . " we ' re completely in the dark . "
according to reports , an official from administrator has said there is strong interest in the company ' s metals trading division , sparking speculation within the company of potential acquirers , he said .
parties rumoured to be interested in acquiring the division include bnp paribas , coke metals , hsbc and goldman sachs .
" enron still has a membership of the london metals exchange which is of interest to banks who want to get back into the business , " said the employee , who requested anonymity .
" it ' s not the only asset that would be of interest though . the pipeline and fact that ( enron ) has warehousing should be worth hundreds of millions of dollars . "
enron , which employs a total of 21 , 000 people , has been flooded with phone calls all morning from customers seeking information on the company ' s plans .
" for now , we ' re still optimistic that a solution will be found and we won ' t lose our jobs , " said the employee .
analysts are expecting enron to file for bankruptcy protection after dynegy inc yesterday terminated their merger agreement and the company ' s ratings were reduced to junk status .
the stock , which lost 85 pct of its value yesterday , has been forced out of the s & p 500 .
cl / jad
copyright ? 2000 dow jones & company , inc . all rights reserved .
enron said to guarantee europe pwr delivery only thu , fri
11 / 29 / 2001
dow jones energy service
( copyright ( c ) 2001 , dow jones 331 - 4017 - 1740 ; sarah . wachter @ dowjones . com
copyright ? 2000 dow jones & company , inc . all rights reserved .
usa : dynegy cites deterioration in enron operations .
11 / 29 / 2001
reuters english news service
( c ) reuters limited 2001 .
houston , nov 29 ( reuters ) - dynegy inc . chairman and chief executive chuck watson on thursday said disclosures by enron corp . of further deterioration in its operations led dynegy to pull out of a deal to acquire the beleaguered energy trading giant and keep it afloat .
a nov . 19 filing with regulators showed that enron faced insurmountable problems both in the long term and the short term , causing dynegy to invoke " material adverse change " clauses allowing it to pull out of its agreement to acquire enron , watson said in an interview with cnbc television .
announcements on wednesday by credit - rating agencies that they had downgraded enron debt to junk status also played a key role in dynegy ' s decision , he said .
watson said dynegy is confident that it will take control of enron ' s northern natural gas pipeline unit next month under a clause of the acquisition agreement that allowed it to keep the 16 , 500 miles of pipeline if the deal collapsed .
enron has said it will contest dynegy ' s claim to the pipeline .
copyright ? 2000 dow jones & company , inc . all rights reserved .
csfb : three big banks have $ 1 . 5 b loan exposure to enron
11 / 29 / 2001
dow jones capital markets report
( copyright ( c ) 2001 , dow jones 201 - 938 - 4192 ; michael . derby @ dowjones . com
copyright ? 2000 dow jones & company , inc . all rights reserved .
usa : update 1 - daschle says congress needs answers on enron .
11 / 29 / 2001
reuters english news service
( c ) reuters limited 2001 .
washington , nov 29 ( reuters ) - u . s . senate majority leader tom daschle said on thursday that congress should find out what brought one - time energy giant enron corp . to the brink of bankruptcy , and see if it has broader ramifications for the energy industry .
" we certainly need to try to find answers to the questions involving the collapse of enron , " the south dakota democrat told reporters .
" i think we need to find as much information as possible , and make some assessments of whether it ' s indicative of energy in the larger context and if it is , what we ought to do about it . but clearly , it raises some very serious questions , " daschle said .
activity at many enron units in more than 40 countries around the world ground to a halt this week . the global giant employs 21 , 000 people in operations ranging from marketing electricity and natural gas to delivering commodities such as metals , coal , pulp and paper .
house energy and commerce committee chairman billy tauzin said on wednesday he did not see a way for the government to try to rescue enron , which was near collapse after rival energy trader dynergy inc . pulled out of a deal to buy it .
" i can ' t right now envision anything the government can do , other than encourage the parties who are discussing a merger to continue their efforts , " said tauzin , a louisiana republican .
copyright ? 2000 dow jones & company , inc . all rights reserved .
enron crisis hits four japanese money mgmt funds - nikkei
11 / 29 / 2001
dow jones international news
( copyright ( c ) 2001 , dow jones & company , inc . )
tokyo ( nikkei ) - - the reverberations of the crisis at u . s . energy trading giant enron corp . are starting to shake japanese investors , the nihon keizai shimbun reported in its friday morning edition .
with enron now on the edge of bankruptcy , money management funds managed by nikko asset management co . and three other fund companies fell below their par value of yl 0 , 000 thursday due to losses on enron bonds .
the money management funds have apparently fallen 0 . 5 % to 7 % under par value , a significant loss of principal given that the funds total more than y 3 trillion in size .
japan has experienced two previous cases of money management funds falling under their face value , but the losses were smaller in scale .
the four fund companies are being besieged with redemptions by nervous investors anxious to retrieve their money . nikko asset management , for example , has reportedly received requests for redemptions totaling more than yl trillion out of a total fund balance of y 2 . 7 trillion .
japan investment trust management co . and sumisei global investment trust management co . , two of the other firms hit by losses on enron bonds , also received redemption requests equivalent to nearly 30 % of total fund assets . the fourth firm affected was ufj partners asset management co .
jittery investors , meanwhile , are asking other fund companies , even those not affected by the enron crisis , to disclose their asset holdings in money management funds .
in response , shinko investment trust management co . has drawn up plans to send to brokers materials disclosing all holdings in its money management fund and a medium - term government bond investment fund .
daiwa asset management co . is also considering ways to beef up disclosure for what is the largest money management fund in the industry .
analysts and industry executives are expressing concern that the declines below the par value could cause investors to rethink the safety of money management funds . these funds have been marketed as ultrasafe investment vehicles and a good alternative to bank deposits when a cap on deposit insurance protection is reimposed in april next year . with interest rates continuing to languish at extremely low levels , some fund managers have been tempted to add riskier corporate bonds to their holdings in an attempt to pump up fund yields .
money management funds had more than yl 8 trillion in assets as of the end of october , accounting for about one - third of assets in all investment trusts .
copyright ? 2000 dow jones & company , inc . all rights reserved .
enron bonds signal anticipated enron bankruptcy filing
by michael c . barr
of dow jones newswires
11 / 29 / 2001
dow jones capital markets report
( copyright ( c ) 2001 , dow jones & company , inc . )
new york - ( dow jones ) - the corporate bond market is signaling its anticipation of an imminent bankruptcy filing by beleaguered energy services company enron corp . ( ene ) .
there is a 22 - 1 / 2 bid both for bonds maturing in 2003 and 2009 . and neither bid is with accrued interest .
the combination of the bonds trading without accrued interest , or flat , and the withering of the normal gap in price between shorter - and longer - dated maturities means the market believes " the company is probably going into bankruptcy , " said tom haag , senior analyst in charge of distressed securities , lutheran brotherhood , minneapolis .
by trading flat , investors are saying that they do not expect to receive any further interest payments from enron . and the sameness of price , regardless of maturity , signals that the market believes all the bonds will be treated the same in a bankruptcy proceeding , said haag .
normally , bond prices reflect greater risk of repayment for longer - dated maturities .
on wednesday , before standard & poor ' s and the two other major ratings agencies downgraded enron to speculative grade from investment grade , enron ' s 7 - 7 / 8 % coupon bonds maturing in 2003 were being offered at a price of $ 59 with accrued interest , traders said .
after the downgrades , prices fell into the 20 s but the bonds were still quoted with accrued interest , said harold rivkin , principal , h . rivkin 201 - 938 - 2008 ; michael . barr @ dowjones . com
copyright ? 2000 dow jones & company , inc . all rights reserved .
usa : nymex restricts trading with enron .
11 / 29 / 2001
reuters english news service
( c ) reuters limited 2001 .
new york , nov 29 ( reuters ) - the new york mercantile exchange thursday morning restricted trades with beleaguered energy firm enron corp . or its affiliates , floor traders said .
before thursday ' s opening of floor trade at 10 a . m . est ( 1500 gmt ) , nymex president j . robert collins sent a fax to nymex traders calling for the restrictions , effective immediately , on trades with enron .
" no floor member may accept any order placed directly to the trading floor by enron or an enron affiliate unless such floor member has received express written authorization from an exchange clearing member carrying an enron account that such clearing member agrees to accept any and all orders placed directly by enron , " the fax stated .
nymex lists futures and options on crude oil , natural gas , heating oil , unleaded gasoline , platinum and palladium . its comex subsidiary carries futures and options on gold , silver and copper .
copyright ? 2000 dow jones & company , inc . all rights reserved .
enron fallout continues to pressure bank sector bonds
by richard a . bravo
of dow jones newswires
11 / 29 / 2001
dow jones capital markets report
( copyright ( c ) 2001 , dow jones & company , inc . )
new york - ( dow jones ) - yield margins to treasurys on bank bonds continued to widen thursday as the aftershocks of the enron corp . ( ene ) debacle continued to affect the sector .
all three major ratings agencies lowered their ratings of the energy services company to junk status on wednesday , while dynegy inc . ( dyn ) pulled the plug on a potential acquisition of the company .
citigroup inc . ( c ) and j . p . morgan chase & co . ( jpm ) each have an estimated direct line exposure to enron of $ 500 million , according to a research report issued thursday by credit suisse first boston .
at the open thursday , j . p . morgan chase ' s 10 - year bonds were quoted at a spread of 132 basis points over treasurys . after moving out as wide as 139 basis points in morning dealings , they ratcheted back in to 134 basis points over treasurys by late morning .
citigroup ' s 10 - year paper opened the day at 112 basis points over treasurys . the outstanding debt widened out as far as 119 basis points over treasurys before moving back in to 116 basis points over treasurys .
on wednesday , spreads on citigroup and j . p . morgan debt widened 11 basis points while bank spreads in general were seven to eight basis points wider .
wells fargo 201 938 - 2087 richard . bravo @ dowjones . com
copyright ? 2000 dow jones 15 % annual earnings growth
11 / 29 / 2001
pr newswire
( copyright ( c ) 2001 , pr newswire )
steve malcolm says expected net exposure linked to enron to be less than
$ 100 million
tulsa , okla . , nov . 29 / prnewswire / - - steven j . malcolm , president and chief operating officer of williams ( nyse : wmb ) , said today he expects the company to meet or exceed all of its previously announced earnings targets .
" we are traditionally conservative in managing our risk , so we currently believe our net exposure related to enron will be less than $ 100 million , " malcolm said . " our expected earnings growth further validates our strategy of a balanced approach - - investing in strategic energy assets while deploying a marketing company that is focused on offering customers risk management products , versus relying on pure trading activities .
" we believe we are capable of growing our profitability in the years to come and remain enthusiastic about our business mix . we relish the opportunity to clearly establish our solid position to ultimately continue our demonstrated ability to deliver superior results to our shareholders , " he said .
malcolm said he believes the company will deliver recurring 2001 earnings per share of $ 2 . 40 and has the capacity to deliver an ongoing recurring earnings growth rate estimate of 15 percent or more per year .
about williams
williams , through its subsidiaries , connects businesses to innovative , reliable energy products and services . williams information is available at www . williams . com .
portions of this document may constitute " forward - looking statements " as defined by federal law . although the company believes any such statements are based on reasonable assumptions , there is no assurance that actual outcomes will not be materially different . any such statements are made in reliance on the " safe harbor " protections provided under the private securities reform act of 1995 . additional information about issues that could lead to material changes in performance is contained in the company ' s annual reports filed with the securities and exchange commission .
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/ contact : media relations , jim gipson , + 1 - 918 - 573 - 2111 , or jim . gipson @ williams . com , or investor relations , rick rodekohr , + 1 - 918 - 573 - 2087 , or rick . rodekohr @ williams . com , or richard george , + 1 - 918 - 573 - 3679 , or richard . george @ williams . com , all of williams / 11 : 07 est
copyright ? 2000 dow jones & company , inc . all rights reserved .