STOCKWATCH Enron higher after Merrill Lynch's cautious upgrade to 'buy'
AFX News, 10/09/01
USA: RESEARCH ALERT-Merrill Lynch upgrades Enron.
Reuters English News Service, 10/09/01
Upgrades & Downgrades: Changes For CVS, Enron
CNNfn: Market Coverage - Morning, 10/09/01
ARGENTINA: Azurix withdraws from Buenos Aires water contract.
Reuters English News Service, 10/09/01
Power providers cry foul over fees / State is accused of improper billing
The San Francisco Chronicle, 10/09/01
Trammell Crow Company Names Rebecca McDonald to Board of Directors
Business Wire, 10/09/01
Enron Corp. Raised to Long-Term `Buy' at Merrill
2001-10-09 06:00 (New York)
Northwest to Buy Portland General
CBS MarketWatch.com, 10/8/2001 



STOCKWATCH Enron higher after Merrill Lynch's cautious upgrade to 'buy'

10/09/2001
AFX News
(c) 2001 by AFP-Extel News Ltd

NEW YORK (AFX) - Shares of Enron Corp were higher in morning trade after Merrill Lynch issued a cautiously optimistic note upgrading the stock to 'buy' from 'accumulate' following Enron's sale of certain US and Indian assets, dealers said. At 11.35 am, Enron gained 36 cents, or 1.08 pct, to 33.81 usd. 
The Dow Jones Utility Average (DUX) declined 4.26 points to 316.05. 
On the broader indices, DJIA lost 16.26 points to 9,051.68, the S&P 
500 fell 3.50 to 1,058.90, while the Nasdaq composite dropped 23.21
points lower to 1,583.53. 

In a note issued early this morning, Merrill Lynch analyst Donato Eassey said, the agreement to sell Portland General and its India oil and gas interest, has positioned the company to focus on its more profitable core businesses, while substantially reducing its debt load by the end of 2002.
The sale of Portland General is expected to add 1.88 bln usd of cash to the company coffers at the close of the transaction fourth-quarter of 2002. The deal will also bring 1.1 bln usd of debt relief. 
Meanwhile, the sale of Indian oil and gas assets should bring in 388 mln usd. 
Eassey expects more asset sales by the company in the near future. 
The divestiture of the troubled Dabhol power facility in India along with smaller international gas assets could provide the company with additional liquidity, he said. 
"Enron could ultimately (in the next 3 years) raise another 1.8 bln usd or so from Dabhol and other non-core international assets." 
The Dabhol plant is 65 pct owned by Enron, making it the biggest investment in India by a non-Indian company. 
The company's partner, Maharashtra State Electricity Board (MSEB), owns 15 pct. MSEB owes Enron 48 mln usd for past power bills, but claims the power is too expensive and says it cannot absorb it all. The plant has lied idle since. 
Many questions, however, remain unanswered, said Eassey, noting that despite the upgrade he is remaining cautious. 
"While Enron has a menu of assets to draw upon to raise capital, reduce debt and improve its earnings prospects in the process, the primary question centres on timing," he said. 
"Will the asset sales line up with an expected balance sheet clean up (with prospective gains offsetting losses)? 
"Can Enron sell its interest in Dabhol anytime soon, given the current war environment? 
"What impact will the weakening economies of South America such as Brazil and Argentina, not too mention the negative economic sentiment here in the US, have on Enron's and other internationally diverse companies' earnings outlook?" 
These issues, along with the earnings drag from about 967 mln usd invested in its broadband unit and the viability of its 3.5 bln usd of goodwill, will likely continue to weigh on the stock near-term, explained Eassey. 
Reflecting the above uncertainties, Eassey said he is "cautiously lightening" his 3-year growth outlook from the 20 pct range to 16-17 pct a year. Earnings per share estimates for 2001 stand at 2.10 usd, while the 2003 forecast is 2.45 usd. 
Accordingly, Eassey's 'long-term' price objective now stands at 44 usd, or 31 pct above its current price with an upgrade on the shares to buy from accumulate. 
blms/lj For more information and to contact AFX: www.afxnews.com and www.afxpress.com

Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. 	

USA: RESEARCH ALERT-Merrill Lynch upgrades Enron.

10/09/2001
Reuters English News Service
(C) Reuters Limited 2001.

NEW YORK, Oct 9 (Reuters) - Merrill Lynch said on Tuesday analyst Donato Eassey has upgraded Enron Corp. to "long-term buy" from "accumulate," explaining some of the big power marketers' clouds have cleared with the agreements to sell Portland General Electric and its India oil and gas interests. 
Stating Enron is well on its way to resharpening its focus on its more profitable core businesses while substantially reducing its debt load by the end of 2002, the analyst said: "We still expect more in the way of asset sales such as the Dabhol power facility along with smaller international gas assets."
While Enron has a host of assets to draw upon to raise capital, reduce debt, and improve its earnings prospects in the process, the primary question centers on timing, Eassey said. "What impact will the weakening economies of South America such as Brazil and Argentina, not too mention the negative economic sentiment here in the United States, have on Enron's and other internationally diverse companies' earnings outlook?" 
He said these issues, along with the earnings drag from about $967 million invested in its broadband unit and viability of its $3.5 billion of goodwill, will likely continue to weigh on the stock in the near term. "Reflecting the above uncertainties, we are cautiously lightening our three-year growth outlook from the 20 percent range to 16 percent to 17 percent per annum." 
In Tuesday morning trading, Enron shares were up 30 cents to $33.75 after early buying carried Monday's $1.72 advance as high as $34.07.

Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. 	

Business
Upgrades & Downgrades: Changes For CVS, Enron
Rhonda Schaffler

10/09/2001
CNNfn: Market Coverage - Morning
(c) Copyright Federal Document Clearing House. All Rights Reserved.

RHONDA SCHAFFLER, CNNfn ANCHOR, MARKET CALL: Time now for "Upgrades & Downgrades": Lehman Brothers is cutting CVS (URL: http://www.cvs.com/) to a buy from a strong buy. Lehman says the weak economy combined with increased retail competition and high expenses could hurt CVS in the near-term. 
ABN Amro downgrades Micron (URL: http://www.micron.com/) to a hold from an add, to match its underweight recommendation of the semiconductor sector. The brokerage firms sees some problems for the D-Ram business.
Goldman Sachs is cutting Sempra Energy (URL: http://www.sempra.com) to market outperform from its U.S. recommended list and cutting its price target by $7, to $29. Goldman says it sees limited upside potential for the stock. 
And finally, Merrill Lynch is raising Enron (URL: http://.www.enron.com/) to a buy from an accumulate. Merrill says Enron is off to a great start in getting its financial health in order. 
Let`s see how these stocks are trading so far; You can see the group is mostly lower, except for Enron. It is up. 
"Market Call" will be right back after this break. 

Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. 	

ARGENTINA: Azurix withdraws from Buenos Aires water contract.

10/09/2001
Reuters English News Service
(C) Reuters Limited 2001.

BUENOS AIRES, Argentina, Oct 9 (Reuters) - Water company Azurix, a unit of energy company Enron Corp. , said on Tuesday it had withdrawn from its contract to distribute drinking water in Buenos Aires province after ongoing disputes with the provincial government. 
"Azurix Buenos Aires SA ... officially notified the government of its withdrawl from the concession contract due to serious breaches on the part of the province of Buenos Aires," the company said in a statement without providing further details.
In recent months, Azurix has accused the province - Argentina's largest and most indebted - of not complying with certain conditions in the concession, a 30-year deal for which the company paid $439 million in late 1999. 
Azurix provides water services to 2.5 million people in 71 cities in the province, which says it has met all conditions of the contract,.

Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. 	

NEWS
Power providers cry foul over fees / State is accused of improper billing
Bernadette Tansey
Chronicle Staff Writer

10/09/2001
The San Francisco Chronicle
FINAL
A.13
(Copyright 2001)

Electricity suppliers long accused of manipulating California's energy market are turning the tables on the state, saying its independent grid manager is forcing them to make up the cost of bad energy deals signed by Gov. Gray Davis' administration. 
The power traders accuse the Independent System Operator -- which is legally required to act as an impartial market manager -- of improperly helping state power buyers spread out the cost of high- priced electricity contracts.
Energy firms as well as municipal utility systems have complained about mysterious charges on their accounts with the grid agency, said Jan Smutney-Jones of the Independent Energy Producers Association, which represents such industry giants as Enron, Dynegy, Williams and Reliant. 
The charges showed up around the time the state Department of Water Resources was forced to start selling excess electricity it had purchased at an average of $69 per megawatt hour for as little as $1 per megawatt hour. 
"The ISO seems to be following specific instructions the Department of Water Resources is giving them," Smutney-Jones said. 
An industry source said NRG Energy Inc. and other suppliers were preparing a formal complaint to the Federal Energy Regulatory Commission, which could order the state to issue refunds to generators if it finds they have been improperly charged. 
The commission has ordered an unprecedented operational audit of the grid management agency. 
State officials bought power under long-term contracts when it appeared California could suffer serious power shortages over the summer. Instead, the state had more than enough power, and electricity available on the spot market suddenly cost half as much as the energy California had bought. 
Gary Ackerman of the Western Power Trading Forum, an industry group, said the grid operator was using a combination of power scheduling and billing practices to "bury" some of the cost of power purchased by the state in the accounts of other generators. 
"The state is the biggest buyer and seller of electricity, and they control the governing board of the ISO," Ackerman said. 
The governor's spokesman, Steve Maviglio, called the power firms' accusations "absolutely false" and said the generators were trying to whip up sentiment in Washington to interfere with the state's affairs. 
"The generators know they'll get a much better deal at FERC headquarters in Washington than they will in Sacramento," Maviglio said. "It shouldn't be a surprise that they make these accusations here to get federal involvement." 
Oscar Hidalgo, a spokesman for the Department of Water Resources, said generators could hardly cast themselves as victims in California's energy crisis. 
"I don't feel sorry for them one bit," Hidalgo said. "They had one heck of a year." 
Gregg Fishman, spokesman for the ISO said the agency was preparing a response to the accusations. 
Energy trade organizations said they suspected the ISO of using several mechanisms to charge suppliers for state contract costs. 
The extra expense is sometimes tacked on to suppliers' bills for ISO operating costs, which all electricity sellers in California share, Ackerman said. 
Some firms say they have tried to buy cheap spot market electricity for resale, only to find later that the grid manager has charged them for more expensive state power. Others say the grid operator orders them to activate stand-by power units on too-short notice. When they can't comply, they say, the ISO brings high-priced state power on line and bills them for the extra cost. 
The accusations are part of a struggle for control of California's grid. In January, Davis disbanded the ISO's 26-member governing board, which was chaired by Smutney-Jones, after some critics said it was too cozy with industry. Davis appointed his own five-member board. 
In February, then-FERC Chairman Curt Hebert said the new board had become "a political arm of the governor." The commission is trying to get California to turn over its grid to a multistate transmission organization. 
Davis has warned Washington to "keep its hands off" the ISO.

Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. 	


Trammell Crow Company Names Rebecca McDonald to Board of Directors

10/09/2001
Business Wire
(Copyright (c) 2001, Business Wire)

DALLAS--(BUSINESS WIRE)--Oct. 9, 2001--Trammell Crow Company (NYSE: TCC) today announced the appointment of Rebecca A. McDonald to its Board of Directors. 
McDonald's appointment is effective October 1, 2001, and her initial term expires at the Company's annual meeting of stockholders in 2002.
McDonald is currently President of the Houston Museum of Natural Science, one of the nation's premier museums. She formerly served as Chairman and Chief Executive Officer of Enron Global Assets and was responsible for all of Enron's global energy asset portfolio, including numerous power plants, pipelines, gas and electricity distribution centers throughout Asia, Africa, the Caribbean Basin and South America. 
Prior to joining Enron, McDonald served as President and Chief Executive Officer of Amoco Energy Development Company, where she was responsible for developing equity interests in international exploration and production operations. She also led the company's participation in and expansion of international commercial transactions, privatizations and capitalizations. Additionally, McDonald was responsible for establishing Amoco's North American trading operations. 
Prior to joining Amoco, McDonald served as president of Tenneco Energy Services and held various management positions with Panhandle Trading Company, Panhandle Eastern pipeline, and Trunkline Gas. 
J. McDonald Williams, Chairman of the Board for Trammell Crow Company, said "With her background in leading large scale organizations in international business, Rebecca brings a perspective and set of business experiences that will be invaluable as we continue to build our international real estate services capabilities." 
McDonald currently serves on the Advisory Committee of the Export-Import Bank of the United States and was a founding member of the Mercosur Council. She also serves as an outside director for Granite Construction Company in California and Eagle Global Logistics in Houston, Texas. 
McDonald joins board members J. McDonald Williams, Chairman, Trammell Crow Company; Robert E. Sulentic, President & CEO, Trammell Crow Company; H. Pryor Blackwell, President, Development and Investment Group, Trammell Crow Company; William F. Concannon, President, Global Services Group, Trammell Crow Company; James R. Erwin, retired, former Vice Chairman, Bank of America; Henry J. Faison, Executive Vice President, Trammell Crow Company; Curtis F. Feeny, Managing Director, Voyager Capital; Jeffrey M. Heller, Vice Chairman, EDS; and Rowland T. Moriarty, President & CEO, Cubex Corporation. 

Founded in 1948, Trammell Crow Company is one of the largest diversified commercial real estate services companies in the United States. In offices throughout the United States and Canada, Trammell Crow Company is organized to deliver management services, transaction services and development and project management services to both investors in and users of commercial real estate. The company's Global Services Group delivers all management, transaction and project management services domestically and internationally. Development and investment activities are conducted through the Development and Investment Group. The company has international service delivery in Europe and Asia through its strategic alliance with Savills plc, a leading property services company based in the United Kingdom, and the jointly owned outsourcing company Trammell Crow Savills Limited. In addition, the company has offices in Chile, Argentina, Brazil and Mexico. Trammell Crow Company is traded on the New York Stock Exchange under the ticker symbol "TCC" and is located on the World Wide Web at www.trammellcrow.com


CONTACT: Trammell Crow Company Barbara Bower, 214/863-3020 
08:43 EDT OCTOBER 9, 2001 
Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. 	


Enron Corp. Raised to Long-Term `Buy' at Merrill
2001-10-09 06:00 (New York)

     Princeton, New Jersey, Oct. 9 (Bloomberg Data) -- Enron Corp. (ENE US)
was raised to long-term ``buy'' from long-term ``accumulate'' by analyst
Donato J. Eassey at Merrill Lynch.  The near-term rating was maintained
``neutral.''


Northwest to Buy Portland General
CBS MarketWatch.com
10/8/2001 7:44:00 PM 
PORTLAND, Ore., Oct 08, 2001 (AP Online via COMTEX) -- Northwest Natural Gas Co. is buying another Oregon utility from Enron Corp. for $1.8 billion, combining the state's largest natural gas and electric utilities in a merger that may save ratepayers money but could also bring some job losses.
Richard G. "Dick" Reiten, chairman and CEO of Northwest Natural, said Monday the gas company is buying Portland General Electric Co. after the Houston-based energy giant gave up on its expansion into the Pacific Northwest.
"We're extremely pleased that the acquisition will return PGE to local ownership," Reiten said at a news conference.
Bob Jenks, executive director of the Citizens Utility Board, said he was concerned the combination could encourage Northwest Natural to bypass state regulators by using its business clout to lobby the Legislature and governor's office when rate increases are needed.
"If that's going to happen, and PGE rate cases are fought out in the Legislature and the governor's office, then I don't think that's going to be in the interest of PGE customers," Jenks said.
Northwest Natural was founded in 1859, the year Oregon became a state, using gas extracted from coal to light downtown street lamps.
PGE was founded in 1889 with a hydroelectric generator at Willamette Falls that anchored the nation's first long-distance electric transmission line when it was connected to the city, 14 miles to the north. The plant still operates, generating 16 megawatts of electricity.
Reiten said the Northwest Natural board of directors has rejected buyout offers itself in recent years in hopes that an opportunity like the PGE deal would come along.
"It was a conscious choice to remain independent and build assets rather than sell out of state," Reiten said. "That patience has paid off."
He said the deal will create a $5 billion utility that can cut costs by combining repair crews, equipment, service centers and billing in their overlapping service area.
Portland General has about 733,000 customers in northwestern Oregon and Northwest Natural has about 530,000 customers in roughly the same area, including some in southwestern Washington state. Their headquarters are just a few blocks apart on the same downtown street.
Federal and state regulatory approval, along with shareholder approval, is expected to take about a year.
Some job cuts were expected, but Reiten said he hoped most would come through attrition and retirement, rather than layoffs.
He said regulators have looked favorably on recent mergers of gas and electric utilities because they generally have saved money for ratepayers. Combined utilities already serve about two thirds of the nation, he added.
Enron purchased PGE in 1997 for about $3.2 billion, including assumption of debt, hoping to tap into energy trading along the entire West Coast, from California to Washington state. But the Texas company found the pace of deregulation in Oregon too slow at a time when the California energy crisis was unfolding.
Enron has a history of buying and selling smaller companies as it searches for the best position in the constantly shifting energy market, said Mike Heim, an A.G. Edwards & Sons analyst who follows the Texas company.
"It's really more a strategic move," Heim said.
Enron will receive $1.55 billion cash and $350 million in securities for PGE.
Enron stock closed at $33.45 on Monday, up $1.72 per share. Northwest Natural was at $22.99, down 42 cents a share.
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