Northwest Natural In Talks With Enron Over Portland Utility
The Wall Street Journal, 10/05/01

NW NATURAL CONFIRMS TALKS REGARDING PORTLAND GENERAL ELECTRIC
PR Newswire, 10/05/01

Enron in Talks to Sell Oregon Utility to Northwest Natural Gas
Bloomberg, 10/05/01

UK: Enron in talks to sell Portland to Northwest-WSJ.
Reuters English News Service, 10/05/01
Enron in talks to sell Portland General to Northwest Natural - report
AFX News, 10/05/01
Enron Considers Selling Utility Unit to Northwest Natural for $1.8 Billion
Dow Jones Business News, 10/05/01
Enron May Sell Portland for $2.8 Billion, WSJ Says (Update3)
Bloomberg, 10/05/01

USA: Northwest Natural increases quarterly common div.
Reuters English News Service, 10/05/01
Enron to eliminate 500 jobs in Europe
Houston Chronicle, 10/05/01
UK's BG Says Purchase Of Enron India Assets In Jeopardy
Dow Jones International News, 10/05/01
INDIA PRESS: Enron Offshore Field Sale To BG May Fail
Dow Jones Energy Service, 10/05/01
British Gas unlikely to get operatorship
Financial Express, 10/05/01
INDIA: India Tata to finalise Enron bid in 3 wks - papers.
Reuters English News Service, 10/05/01
INDIA PRESS: BSES Won't Buy Enron's Stake In Dabhol
Dow Jones International News, 10/05/01
Tata Power seeks 3 weeks to firm up Dabhol offer
Business Standard, 10/05/01
Tata Power, Enron set for time-bound talks on DPC stake sale
Financial Express, 10/05/01
Moody's Modi on Tata Power Plan to Buy Enron Unit: Comment
Bloomberg, 10/05/01

UK: Enron to cut up to 10 pct of European workers-WSJ.
Reuters English News Service, 10/04/01






Northwest Natural In Talks With Enron Over Portland Utility
By Wall Street Journal staff reporters Robin Sidel, Rebecca Smith and Nikhil Deogun

10/05/2001
The Wall Street Journal
B2
(Copyright (c) 2001, Dow Jones & Company, Inc.)

Enron Corp. is in advanced discussions to sell its Portland General Electric utility unit to Northwest Natural Gas Co. for about $1.8 billion in cash and stock in a highly leveraged transaction that would eventually give Enron a minority stake in Northwest, according to people familiar with the matter. 
The discussions are at a very delicate stage, and some important points need to be finalized, these people caution. The current environment could also make financing such a transaction quite difficult, and board approval isn't a certainty. However, should the two sides agree to terms, a deal could be announced in the next few days. Northwest Natural is also expected to assume roughly $1 billion in debt.
Enron and Northwest Natural declined to comment. 
If a transaction is consummated, it would come nearly six months after the collapse of Enron's agreement to sell the utility to Sierra Pacific Resources. That transaction fell apart in part because of the California energy crisis. 
A purchase of Portland General would be a very big bite for Northwest Natural, which has a market capitalization of just $650 million and supplies natural gas to more than 500,000 residential and business customers in Oregon and Vancouver, Wash. Portland General is an electric utility serving more than 1.4 million customers in Oregon. 
The deal would bring together two Oregon utilities whose executives and employees know each other well. Richard G. Reiten, Northwest's chairman and chief executive, was president and chief operating officer of Portland General between 1989 and 1996, and also served on its board. 
By buying a utility, Northwest would hope to have more bargaining power in its gas purchases, enabling it to buy more product and store it when prices are cheap. A deal would be accretive to Northwest's earnings, people familiar with the matter say. And the financial risk for Northwest Natural is somewhat muted because Enron is helping to facilitate and finance the transaction by agreeing to take common stock and convertible preferred stock in Northwest Natural in addition to cash. Northwest Natural would finance the transaction with debt and equity offerings. 
Shares of Northwest Natural were trading up $1.04 at $25.99 in 4 p.m. composite trading on the New York Stock Exchange, while Enron stock was down 39 cents a share at $33.10. 
For Enron, a deal with Northwest Natural would be the latest twist in a five-year ordeal that was supposed to help the nation's biggest energy trader break into California's deregulating electricity market. But the utility business proved less valuable than anticipated when Enron was prevented from selling off utility contracts that enabled it to buy electricity cheaply. And California's market developed serious problems last year that made it a less attractive place for Enron to do business. 
Enron, which also owns a major gas-transmission pipeline system, has a history of buying assets and businesses, learning what it can from them, and then selling off the bulk of physical assets so it can reinvest capital elsewhere. 
It isn't clear where Enron will put the capital to work that it garners from the sale. Its broadband telecommunications business is in the doldrums and it recently said it would invest $250 million in it this year, down from a formerly projected $750 million.

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

NW NATURAL CONFIRMS TALKS REGARDING PORTLAND GENERAL ELECTRIC
2001-10-05 08:39 (New York)


(The following is a reformatted version of a press release issued by NW Natural
and received via fax. The release was confirmed by the sender.)

October 5, 2001

NW NATURAL CONFIRMS DISCUSSIONS REGARDING PORTLAND GENERAL ELECTRIC

PORTLAND, Ore. - Northwest Natural Gas Company (NYSE: NWN) ("NW Natural"), in
response to press reports, today confirmed that it is engaged in discussions
with Enron Corp. (NYSE: ENE) regarding a potential acquisition by NW Natural of
Enron's wholly-owned subsidiary, Portland General Electric Company (PGE). There
can be no assurances that any transaction will result from these discussions,
NW Natural does not intend to make any additional comments regarding this matter
unless and until a formal agreement has been reached.



Enron in Talks to Sell Oregon Utility to Northwest Natural Gas
2001-10-05 08:37 (New York)


     Houston, Oct. 5 (Bloomberg) -- Enron Corp., the largest
energy trader, is in talks to sell its Portland General Electric
utility to Northwest Natural Gas Co., more than five months after
a planned sale to Sierra Pacific Resources collapsed.

     Northwest didn't give a price in a faxed statement. The Wall
Street Journal put the potential price at $2.8 billion in cash,
stock and assumed debt, citing unidentified people familiar with
the matter. Enron spokesman Mark Palmer declined to comment.


UK: Enron in talks to sell Portland to Northwest-WSJ.

10/05/2001
Reuters English News Service
(C) Reuters Limited 2001.

LONDON, Oct 5 (Reuters) - U.S. energy group Enron Corp is in advanced talks to sell its Oregon-based Portland General utility to Northwest Natural Gas Co for $1.8 billion, the Wall Street Journal's online edition reported. 
Citing people familiar with the matter, it said talks were at a delicate stage and financing could be a problem for Northwest, which has a market value of only about $650 million.
But a deal could be announced in the next few days with Northwest assuming also some $1 billion of debt, it said. 
Earlier this year, Enron's plans to sell Portland to Sierra Pacific Resources Corp broke down amid the California power crisis. 
In the aftermath of that deal's collapse, industry sources said Britain's Scottish Power Plc , which owns another Oregon-based utility PacifiCorp, had also held talks to buy Portland.

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

Enron in talks to sell Portland General to Northwest Natural - report

10/05/2001
AFX News
(c) 2001 by AFP-Extel News Ltd

NEW YORK (AFX) - Enron Corp is in advanced discussions to sell its Portland General Electric utility unit to Northwest Natural Gas Co for about 1.8 bln usd in cash and stock, the Wall Street Journal reported, citing people familiar with the matter. 
The highly leveraged transaction, under which Northwest Natural is also expected to assume roughly 1 bln usd in debt, would eventually give Enron a minority stake in Northwest.
The discussions are at a very delicate stage. The current environment could make financing such a transaction quite difficult, and board approval is not a certainty. 
But should the two sides agree to terms, a deal could be announced in the next few days, the Journal said. 
Enron and Northwest Natural declined to comment. 
jms For more information and to contact AFX: www.afxnews.com and www.afxpress.com

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

Enron Considers Selling Utility Unit to Northwest Natural for $1.8 Billion

10/05/2001
Dow Jones Business News
(Copyright (c) 2001, Dow Jones & Company, Inc.)

Enron Corp. is in advanced discussions to sell its Portland General Electric utility unit to Northwest Natural Gas Co. for about $1.8 billion in cash and stock in a highly leveraged transaction that would eventually give Enron a minority stake in Northwest, people familiar with the matter told The Wall Street Journal. 
The discussions are at a very delicate stage, and some important points need to be finalized, these people caution. The current environment could also make financing such a transaction quite difficult, and board approval isn't a certainty. However, should the two sides agree to terms, a deal could be announced in the next few days. Northwest Natural (NWN) is also expected to assume roughly $1 billion in debt.
Enron (ENE) and Northwest Natural declined to comment. 
If a transaction is consummated, it would come nearly six months after the collapse of Enron's agreement to sell the utility to Sierra Pacific Resources. That transaction fell apart in part because of the California energy crisis. 
A purchase of Portland General would be a very big bite for Northwest Natural, which has a market capitalization of just $650 million and supplies natural gas to more than 500,000 residential and business customers in Oregon and Vancouver, Wash. Portland General is an electric utility serving more than 1.4 million customers in Oregon. 
The deal would bring together two Oregon utilities whose executives and employees know each other well. Richard G. Reiten, Northwest's chairman and chief executive, was president and chief operating officer of Portland General between 1989 and 1996, and also served on its board. 
By buying a utility, Northwest would hope to have more bargaining power in its gas purchases, enabling it to buy more product and store it when prices are cheap. A deal would be accretive to Northwest's earnings, people familiar with the matter say. And the financial risk for Northwest Natural is somewhat muted because Enron is helping to facilitate and finance the transaction by agreeing to take common stock and convertible preferred stock in Northwest Natural in addition to cash. Northwest Natural would finance the transaction with debt and equity offerings. 
For Enron, a deal with Northwest Natural would be the latest twist in a five-year ordeal that was supposed to help the nation's biggest energy trader break into California's deregulating electricity market. But the utility business proved less valuable than anticipated when Enron was prevented from selling off utility contracts that enabled it to buy electricity cheaply. And California's market developed serious problems last year that made it a less attractive place for Enron to do business. 
Shares of Northwest Natural were trading up $1.04 at $25.99 in 4 p.m. composite trading on the New York Stock Exchange, while Enron stock was down 39 cents a share at $33.10. 
Copyright (c) 2001 Dow Jones & Company, Inc. 
All Rights Reserved.

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

Enron May Sell Portland for $2.8 Billion, WSJ Says (Update3)
2001-10-05 06:34 (New York)

Enron May Sell Portland for $2.8 Billion, WSJ Says (Update3)

     (Adds sale of oil field in India in sixth paragraph.)

     Houston, Oct. 5 (Bloomberg) -- Enron Corp., the largest
energy trader, is in advanced talks to sell its Portland General
Electric utility unit to Northwest Natural Gas Co. for about $2.8
billion in cash, stock and assumed debt, the Wall Street Journal
said, citing unidentified people familiar with the matter.

     Houston-based Enron ``is getting close to another
transaction'' involving Portland General, Chief Executive Kenneth
Lay said at a conference in New York last month. Enron spokesman
Mark Palmer wasn't immediately available to comment.

     Enron has been trying to sell the utility for more than a
year as it focuses on trading. A $3.1 billion sale to Sierra
Pacific Resources collapsed in April because the California power
crisis made it hard to win approval. Northwest Natural Gas serves
more than half a million Oregon and Washington residents.

     Enron shares declined as much as 2.5 euros, or 6.6 percent,
35.5 ($33) in Germany. They've have fallen 60 percent this year
and dropped 1.2 percent to $33.10 in U.S. trading yesterday.

     Some terms of the transaction, which includes about $1.5
billion in assumed debt, still need to be completed, the newspaper
said. An agreement on the sale of the Portland, Oregon-based
utility may be announced in the next few days, the Journal said.

                          Shift in Focus

     Enron earlier this week agreed to sell oil and natural-gas
fields in India to U.K.'s BG Group Plc for $388 million as it
moves away from owning assets such as power plants and pipelines
to concentrate on trading and brokering energy and other
commodities.

     At a price of $2.8 billion, Portland General would fetch 1.2
times sales for Enron, less than the average of four times revenue
paid for U.S. utilities this year, Bloomberg data show.

     Mergers and acquisitions in the energy industry surged at the
start of the year as electricity and natural-gas prices reached a
record high. Since then, prices of power and gas have slumped, in
turn deterring companies from making purchases.

     U.S. natural-gas prices, after reaching a record high at the
end of last year, have since plunged 76 percent to $2.413 for each
million British thermal units on the New York Mercantile Exchange.

     Portland General, which Enron bought in 1997 as a platform to
sell power into California's deregulating market, has 725,027
customers in 51 cities, according to the company's Web site.
Portland, Oregon-based Northwest Natural said in July second-
quarter profit more than doubled to $4.3 million amid cooler
weather and customer growth.


USA: Northwest Natural increases quarterly common div.

10/05/2001
Reuters English News Service
(C) Reuters Limited 2001.

PORTLAND, Ore., Oct 5 (Reuters) - Northwest Natural Gas Co. , a utility serving Oregon and Washington, on Friday said its board has increased the company's quarterly dividend on its common stock to 31.5 cents from 31 cents a share. 
All dividends, including regular quarterly dividends on the company's outstanding series of preferred and preference stock, will be paid Nov 15 to shareholders of record on Oct 31, Northwest Natural said in a statement.
Chairman and Chief Executive Richard Reiten said the higher dividend is supported by the company's positive financial outlook including solid customer growth, additional earnings potential from the natural gas storage and electric generation markets, and continuing cost savings. 
The Wall Street Journal's online edition, citing people familiar with the matter, reported on Friday that energy group Enron Corp. is in advanced talks to sell its Oregon-based Portland General utility to Northwest Natural for $1.8 billion. 
A spokesman for Northwest Natural, which serves about 530,000 customers in western Oregon and southwest Washington, could not be immediately reached for comment. 
Shares of Northwest Natural climbed $1.04, or 4.17 percent, to $25.99 on Thursday.

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

Oct. 5, 2001
Houston Chronicle
Briefs: City & State 
Enron to eliminate 500 jobs in Europe
LONDON -- Enron Corp. plans to cut 500 jobs in Europe, about 10 percent of its work force there, according to the company's chief executive in Europe, John Sherriff. 
The cuts are the first significant retrenchment by Houston-based Enron since it arrived in Europe in 1989. Enron has been the most aggressive U.S. energy company to expand into Europe's deregulating markets, but its core energy trading businesses have been held back by the slow progress toward market liberalization in the European Union. 



UK's BG Says Purchase Of Enron India Assets In Jeopardy

10/05/2001
Dow Jones International News
(Copyright (c) 2001, Dow Jones & Company, Inc.)

LONDON -(Dow Jones)- U.K. oil and gas company BG Group PLC (BRG) Friday said a disagreement has broken out that threatens to scuttle its $388 million acquisition of the Indian upstream assets of Enron Corp. (ENE), the U.S. energy group. 
Company spokesperson Nicole McMahon said BG's goal of acquiring Enron's operatorship of the offshore Tapti gas field and the Panna/Mukti oil and gas field was being challenged by the fields' two other partners - state-owned Oil & Natural Gas Corp. (P.ONG) and Reliance Industries Ltd.(P.REL) - which jointly hold a 70% stake in the assets.
The Indian government wants ONGC and Reliance to have first option on operatorship, which was being pursued by both companies, an Indian newspaper reported Friday. 
When the transaction was announced Wednesday, BG made it clear it would walk away from the deal if it didn't get outright operatorship. 
McMahon said negotiations are continuing with ONGC and Reliance who "have both expressed interest in being the operator of both fields." 
"We believe we have the relevant skills and experience to be the operator," she said. She didn't, however, confirm that BG will pull out of the deal if didn't inherit Enron's operatorship of both Tapti and Panna/Mukti fields, located off India's west coast. 
"We would have to assess the reasons and the outcomes and consider our options," she said 
She said a decision will be made by the end of October. 
BG has portrayed the purchase of Enron Oil and Gas Ltd., or EOGIL, as significant, both boosting the group's global hydrocarbon production by up to 7%, and diversifying its distribution and pipeline interests in the fast-growing Indian energy market. 
About 1018 GMT, BG Group shares were flat at 272.75 pence. 
-By Michael Wang, Dow Jones Newswires; +44-20-7842-9386; michael.wang@dowjones.com

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

INDIA PRESS: Enron Offshore Field Sale To BG May Fail

10/05/2001
Dow Jones Energy Service
(Copyright (c) 2001, Dow Jones & Company, Inc.)

NEW DELHI -(Dow Jones)- U.S.-based Enron Corp.'s (ENE) plan to sell its 30% stake in two offshore oil and natural gas fields to British Gas India Pvt. Ltd. may fall through, the Economic Times reports. 
British Gas India is a unit of U.K.-based oil and natural gas company BG Group PLC (BRG).
According to the report, the Indian government has made it clear that the existing equity holders - Oil & Natural Gas Corp. (P.ONG) and Reliance Industries Ltd. (P.REL) - will have the option to decide on the operatorship of the field once Enron exits. 
ONGC and Reliance together hold a 70% stake in the joint venture exploration project and have claimed operatorship rights over the Panna-Mukta and Tapti oil and gas fields located in India's western coast. 
But British Gas India, which Wednesday announced its plans to take over Enron's offshore interests for $388 million, has made it clear that the deal would fall through if it didn't get the operatorship. 
"The governments role is restricted to that of a facilitator. Enron has written to us regarding their decision to exit and the new deal struck with British Gas," the report says, quoted India's Petroleum and Natural Gas Minister Ram Naik. 
"However, it is for ONGC and Reliance who are existing equity holders to take a decision on the operatorship," Naik said. 
Naik said BG and Enron have struck the deal keeping in mind the existing condition and the possible consequences. "It is for them to find a solution," Naik said, according to the report. 
Newspaper Web site: www.economictimes.com 

-By Himendra Kumar; Dow Jones Newswires; 91-11-461-9426; himendra.kumar@dowjones.com

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

British Gas unlikely to get operatorship

10/05/2001
Financial Express
Copyright (C) 2001 Indian Express Newspapers (Bombay) Ltd.; Source: World Reporter (TM)

New Delhi, Oct 4: BRITISH Gas, which has bought Enrons stake in Panna-Mukta-Tapti oil and gas fields for a consideration of $388 million, is unlikely to get operatorship rights of the Panna, Mukta and Tapti oil and gas fields. 
The whole deal may then fall apart as transfer of the operatorship rights for these fields was set as a major condition precedent by British Gas for acquiring Enrons 30 per cent stake in the oil venture.
Speaking to newspersons, petroleum minister Ram Naik said that British Gas would not have the first claim of becoming operator of Panna-Mukta-Tapti fields by just buying out Enrons stake. Enron is one of the partners in the in the joint venture oil property along 
with Reliance Industries and 
Oil and Natural Gas Corporation (ONGC). 
\"Even before the deal was clinched, all the three joint venture partners i.e., ONGC, Reliance and Enron had entered into an agreement according to which, if the operator company quits the 
joint venture, the first right of refusal lies with the other two partners. 
Therefore, the option of becoming operator in the oil property is with the remaining two partners in the joint venture,\" Mr Naik said. 
British Gas India CEO Nigel Shaw told The Financial Express that the company would not accept anything short of full operatorship right. On being asked whether rotatory operatorship would be acceptable to the company, he said, \"No. It is too messy.\" 
Mr Shaw had stated on Wednesday that the deal with Enron, to be transacted by October end, would fall through if it was not given the operatorship of these oil and gas field. 
Mr Naik said that ONGC, which holds a 40-per cent stake in these fields had staked its claims in these fields much before the deal was sealed between Enron and British Gas. 
Asked on the role of the government in the controversy, Mr Naik said that the Centre will act as a facilitator to help the joint venture companies reach an agreement.

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


INDIA: India Tata to finalise Enron bid in 3 wks - papers.

10/05/2001
Reuters English News Service
(C) Reuters Limited 2001.

BOMBAY, Oct 5 (Reuters) - India's Tata Power Co will finalise a bid in three weeks for U.S. energy giant Enron Corp's 65-percent stake in troubled Dabhol Power Co, newspapers said on Friday. 
Officials at Tata Power , India's largest private utility, were not immediately available for comment.
Earlier this week, Tata managing director Adi Engineer told Reuters the company was in preliminary talks to buy Enron's controlling stake in Dabhol Power, which runs a $2.9 billion power project on India's west coast. 
A Dabhol spokesman said he had no comment. 
Dabhol's 740-MW generator in Maharashtra has been shut since June after its sole buyer, a loss-making local utility, stopped purchasing power and defaulted on payments. 
Enron then stopped work on a near-complete second phase generation unit that would have increased production capacity to 2,184 MW. 
The Financial Express said Indian lenders, who have an exposure of $1.4 billion to the project, will also finalise a revival package in three weeks. 
On Thursday representatives from the Industrial Development Bank of India (IDBI) , the largest lender to the project, met finance ministry officials. 
Tata Power shares were down 3.16 percent at 93.60 rupees in early afternoon trade while the Bombay index was off 0.27 percent. 
The Hindu Business Line said the government had agreed in principle to a set of concessions suggested by the lenders to make the project viable. 
It said these included allotting special distribution zones which would buy at least half the power generated by the project's 1,444 MW second phase. 
The daily said this would involve ending the state-owned National Thermal Power Corporation's 1,400 MW sale of power to Maharashtra.

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


INDIA PRESS: BSES Won't Buy Enron's Stake In Dabhol

10/05/2001
Dow Jones International News
(Copyright (c) 2001, Dow Jones & Company, Inc.)

NEW DELHI -(Dow Jones)- India's BSES Ltd. (P.BSX) won't buy U.S. energy company Enron Corp.'s (ENE) 65% stake in Dabhol Power Co., reports the Business Standard. 
BSES told the Bombay Stock Exchange it has no interest in the 2,184-megawatt Dabhol due to the "uneconomical parameters of the project," the newspaper said.
Costing $2.9 billion, Dabhol, located in the western Indian state of Maharashtra, is the single largest foreign investment in India to date. Newspaper Web site: www.business-standard.com 

-By Himendra Kumar; Dow Jones Newswires; 91-11-461-9426; himendra.kumar@dowjones.com

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

Tata Power seeks 3 weeks to firm up Dabhol offer
Our Economy Bureau NEW DELHI

10/05/2001
Business Standard
1
Copyright (c) Business Standard

Tata Power is expected to firm up its offer for buying foreign equity in Dabhol Power Company in three weeks. 
The Indian lenders to the project, which will meet the Centre after three weeks, have asked for a heavy discount on the equity besides several concessions for taking over the $2.9 billion power project, government officials said.
Tata Power had earlier informed the lenders that it would require four weeks from the time discussions were initiated with Enron for buying its equity in Dabhol. 
At a meeting with the finance and power ministry officials here today, Indian financial institutions led by Industrial Development Bank of India (IDBI) said that payment by the prospective buyer for 85 per cent held by Enron, GE and Bechtel be made in instalments. 
Enron had earlier proposed to sell the foreign equity to domestic lenders in three instalments of 40 per cent, 50 per cent and 10 per cent extending up to January 1, 2003. Indian institutions have an exposure of over Rs 6,000 crore to the 2,184 mega watt project. 
Indian lenders have said that the dispute between all the stakeholders should be resolved before the sale of foreign equity. They have also suggested that the new promoter be provided relief like lowering the interest rate on borrowings, according DPC mega power project status and tax concessions. IDBI chairman PP Vora said after the three-hour long meeting that the lenders have been asked to explore alternatives and revert to the Centre after three weeks. Sources said that during the period, Indian lenders would prepare the roadmap for revival of the project. Negotiations with other possible suitors would also be initiated, they added. 
The institutions have said that the sale of equity be directly negotiated between Enron and the prospective buyers. While BSES has finally decided not to go ahead with its plans to take over DPC, National Thermal Power Corporation has said the project was not economically viable for it. Akin to Godbole Committee recommendations, the institutions have also recommended conversion of dollar-denominated debt to rupee loans to prevent tariff escalation. With DPC having already initiated arbitration proceedings against Maharashtra State Electricity Board (MSEB), the Indian lenders would also look at the legality of sale while the issue was sub-judice. 
Today's meeting, convened by finance secretary Ajit Kumar, was attended by power secretary A K Basu, Vora and other senior executives from IDBI, ICICI, IDFC and State Bank of India apart from government officials.

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

Tata Power, Enron set for time-bound talks on DPC stake sale

10/05/2001
Financial Express
Copyright (C) 2001 Indian Express Newspapers (Bombay) Ltd.; Source: World Reporter (TM)

Mumbai, Sept 28: Tata Power and Enron are understood to be close to an agreement on entering into time-bound negotiations for Tata Power to buy Enrons stake in the troubled Dabhol Power Company (DPC). A time-frame is being talked about in this connection, wherein no other party would be talked to and discussions would take place only between the two sides. 
Industry sources said the Industrial Development Bank of India (IDBI), which is acting as a major facilitator to the stake sale, is a key player in the agreement between Tata Power and Enron. Discussions on the sale of the equity would directly take place between Tata Power and Enron, the sources said.
Tata Power managing director Adi Engineer confirmed his meeting with the Enron India managing director K Wade Cline in the presence of IDBI chairman PP Vora on Thursday. "We have had a preliminary meeting where both the parties were apprised of the situation. We will have to wait for further developments," he added. 
According to sources, a time-bound agreement between Enron and Tata Power would provide an easy access to the various deals which Enron had struck at the time of commencment of work on the 2,184 mw Dabhol project. Tata Power would have to look into over 500 documents related to the Dabhol project and do the due deligence before giving a concrete offer to Enron. 
Tata Power, in a bid to expand its presence across the state, is also keen to hold hard, bargaining over the "acceptable" tariff of the project which would have to be restructured. Investment banking major JM Morgan Stanley, which is understood to be advising the Tatas on the deal, has already swung into action and has started collecting necessary back-up information from various sources including the Maharashtra State Electricity Board, for Tata Power. 
While no comment was available from Enron on the issue, financial institution sources said: "Tata Power is interested in talks. It is a good thing if things work out between the two sides." JM Morgan boss Nimesh Kampani had no comments to offer to The Financial Express when asked about the developments. 
The FIs, led by IDBI, had been keen that they would play the role of facilitator in the sale of the Enron stake in DPC, since huge sums of money are stuck in the project for the borrowers. While even BSES Ltd was being mentioned earlier as one of the contenders, the company does not seem inclined to proceed with it now. That leaves Tata Power as the chief contender for the stake sale. 
The FIs are also expected to play a role in roping in a partner for the LNG facility which is to be hived off. The names of some of the gas majors like British Gas, BP, Shell, Reliance in addition to the state-run Gas Authority of India (Gail) are being mentioned as potential partners in this connection, the sources said. The FIs are clear that any discussion on the LNG facility will have to include the new sponsor of the project.

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

Moody's Modi on Tata Power Plan to Buy Enron Unit: Comment
2001-10-05 06:20 (New York)


     Mumbai, Oct. 5 (Bloomberg) -- Chetan Modi, an analyst with
Moody's Investor's Services in London, speaks on plans by Tata
Power Ltd. to bid for Enron Corp's India unit, Dabhol Power Co.

     Tata Power is India's biggest power producer and has bonds
worth $240 million trading overseas. The bonds are rated at two
levels below investment grade by Moody's, at ``Ba2'' or same as
the country's sovereign rating.

     ``Its inevitable for Tata Power to be interested in buying
Dabhol. Power is their core business and they have the expertise.
I'd be surprised if they weren't interested.

     ``Tata Power management told us they've indicated an interest
but have had no formal discussions with Enron.

     ``We will look at the deal holistically if -- and that's a
big if -- Tata decides to buy Dabhol and its implications on the
company's finances, its debt levels.

     ``We don't see a need to flag (Tata's) bonds as nothing has
happened yet. Dabhol is a big project and the problem will take a
long time to resolve. There are a number of players involved and
all are adamant not to take a haircut.

     ``From Tata Power's point of view the tariff has to be
adjusted to a level that's accepted by its customers without
external supports. The project must stand on its feet.''

     Enron wants to sell Dabhol because of a payment dispute with
the Maharashtra State Electricity Board, its sole customer. MSEB
stopped buying the power in May, saying it was too expensive. It
owes Dabhol $64 million in unpaid bills.
     Dabhol unit is India's biggest foreign direct investment.



UK: Enron to cut up to 10 pct of European workers-WSJ.

10/04/2001
Reuters English News Service
(C) Reuters Limited 2001.

LONDON, Oct 5 (Reuters) - Enron Corp N) is looking to cut its work force in Europe by up to 10 percent, or around 500 jobs, in a move to cut costs and maintain earnings growth, the Wall Street Journal reported on Friday. 
"We have around 5,000 employees in Europe and we are seeking to cut our headcount here by between 5 percent and 10 percent, but we will aim as far as possible to achieve this through a program of voluntary severance," John Sherriff, chief executive of Enron Europe told the newspaper.
The cuts are the first significant retrenchment by Enron since it arrived in Europe in 1989. 
Enron has been the most aggressive U.S. energy company to expand into Europe's deregulating markets, but its core energy-trading businesses have been held back by the slow and piecemeal progress toward market liberalisation in the European Union, the paper reported. 
The company declined to be more specific about how far it would scale back individual product lines or coverage of certain geographical areas, the Wall Street Journal said. 
"Enron's business continues to grow in Europe in terms of traded volumes and numbers of transactions, but like any company we are constantly seeking ways to do more with less in order to maintain earnings growth," Sherriff told the paper.

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