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Enron Mail |
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=20 STOCKWATCH Enron higher after Merrill Lynch's cautious upgrade to 'buy' 10/09/2001 AFX News © 2001 by AFP-Extel News Ltd NEW YORK (AFX) - Shares of Enron Corp were higher in morning trade after Me= rrill 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 us= d.=20 The Dow Jones Utility Average (DUX) declined 4.26 points to 316.05.=20 On the broader indices, DJIA lost 16.26 points to 9,051.68, the S&P=20 500 fell 3.50 to 1,058.90, while the Nasdaq composite dropped 23.21 points lower to 1,583.53.=20 In a note issued early this morning, Merrill Lynch analyst Donato Eassey sa= id, the agreement to sell Portland General and its India oil and gas intere= st, has positioned the company to focus on its more profitable core busines= ses, 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. Th= e deal will also bring 1.1 bln usd of debt relief.=20 Meanwhile, the sale of Indian oil and gas assets should bring in 388 mln us= d.=20 Eassey expects more asset sales by the company in the near future.=20 The divestiture of the troubled Dabhol power facility in India along with s= maller international gas assets could provide the company with additional l= iquidity, he said.=20 "Enron could ultimately (in the next 3 years) raise another 1.8 bln usd or = so from Dabhol and other non-core international assets."=20 The Dabhol plant is 65 pct owned by Enron, making it the biggest investment= in India by a non-Indian company.=20 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.=20 Many questions, however, remain unanswered, said Eassey, noting that despit= e the upgrade he is remaining cautious.=20 "While Enron has a menu of assets to draw upon to raise capital, reduce deb= t and improve its earnings prospects in the process, the primary question c= entres on timing," he said.=20 "Will the asset sales line up with an expected balance sheet clean up (with= prospective gains offsetting losses)?=20 "Can Enron sell its interest in Dabhol anytime soon, given the current war = environment?=20 "What impact will the weakening economies of South America such as Brazil a= nd Argentina, not too mention the negative economic sentiment here in the U= S, have on Enron's and other internationally diverse companies' earnings ou= tlook?"=20 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, wil= l likely continue to weigh on the stock near-term, explained Eassey.=20 Reflecting the above uncertainties, Eassey said he is "cautiously lightenin= g" his 3-year growth outlook from the 20 pct range to 16-17 pct a year. Ear= nings per share estimates for 2001 stand at 2.10 usd, while the 2003 foreca= st is 2.45 usd.=20 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 ac= cumulate.=20 blms/lj For more information and to contact AFX: www.afxnews.com and www.af= xpress.com Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 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 Ea= ssey has upgraded Enron Corp. to "long-term buy" from "accumulate," explain= ing some of the big power marketers' clouds have cleared with the agreement= s to sell Portland General Electric and its India oil and gas interests.=20 Stating Enron is well on its way to resharpening its focus on its more prof= itable core businesses while substantially reducing its debt load by the en= d of 2002, the analyst said: "We still expect more in the way of asset sale= s such as the Dabhol power facility along with smaller international gas as= sets." 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 c= enters on timing, Eassey said. "What impact will the weakening economies of= South America such as Brazil and Argentina, not too mention the negative e= conomic sentiment here in the United States, have on Enron's and other inte= rnationally diverse companies' earnings outlook?"=20 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 goodwil= l, will likely continue to weigh on the stock in the near term. "Reflecting= the above uncertainties, we are cautiously lightening our three-year growt= h outlook from the 20 percent range to 16 percent to 17 percent per annum."= =20 In Tuesday morning trading, Enron shares were up 30 cents to $33.75 after e= arly buying carried Monday's $1.72 advance as high as $34.07. Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 Business Upgrades & Downgrades: Changes For CVS, Enron Rhonda Schaffler 10/09/2001 CNNfn: Market Coverage - Morning © Copyright Federal Document Clearing House. All Rights Reserved. RHONDA SCHAFFLER, CNNfn ANCHOR, MARKET CALL: Time now for "Upgrades & Downg= rades": 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 ret= ail competition and high expenses could hurt CVS in the near-term.=20 ABN Amro downgrades Micron (URL: http://www.micron.com/) to a hold from an = add, to match its underweight recommendation of the semiconductor sector. T= he brokerage firms sees some problems for the D-Ram business. Goldman Sachs is cutting Sempra Energy (URL: http://www.sempra.com) to mark= et outperform from its U.S. recommended list and cutting its price target b= y $7, to $29. Goldman says it sees limited upside potential for the stock.= =20 And finally, Merrill Lynch is raising Enron (URL: http://.www.enron.com/) t= o a buy from an accumulate. Merrill says Enron is off to a great start in g= etting its financial health in order.=20 Let`s see how these stocks are trading so far; You can see the group is mos= tly lower, except for Enron. It is up.=20 "Market Call" will be right back after this break.=20 Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 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 cont= ract to distribute drinking water in Buenos Aires province after ongoing di= sputes with the provincial government.=20 "Azurix Buenos Aires SA ... officially notified the government of its withd= rawl from the concession contract due to serious breaches on the part of th= e province of Buenos Aires," the company said in a statement without provid= ing 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.=20 Azurix provides water services to 2.5 million people in 71 cities in the pr= ovince, which says it has met all conditions of the contract,. Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 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 mark= et 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. Gra= y Davis' administration.=20 The power traders accuse the Independent System Operator -- which is legall= y required to act as an impartial market manager -- of improperly helping s= tate power buyers spread out the cost of high- priced electricity contracts= . Energy firms as well as municipal utility systems have complained about mys= terious charges on their accounts with the grid agency, said Jan Smutney-Jo= nes of the Independent Energy Producers Association, which represents such = industry giants as Enron, Dynegy, Williams and Reliant.=20 The charges showed up around the time the state Department of Water Resourc= es was forced to start selling excess electricity it had purchased at an av= erage of $69 per megawatt hour for as little as $1 per megawatt hour.=20 "The ISO seems to be following specific instructions the Department of Wate= r Resources is giving them," Smutney-Jones said.=20 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.=20 The commission has ordered an unprecedented operational audit of the grid m= anagement agency.=20 State officials bought power under long-term contracts when it appeared Cal= ifornia could suffer serious power shortages over the summer. Instead, the = state had more than enough power, and electricity available on the spot mar= ket suddenly cost half as much as the energy California had bought.=20 Gary Ackerman of the Western Power Trading Forum, an industry group, said t= he grid operator was using a combination of power scheduling and billing pr= actices to "bury" some of the cost of power purchased by the state in the a= ccounts of other generators.=20 "The state is the biggest buyer and seller of electricity, and they control= the governing board of the ISO," Ackerman said.=20 The governor's spokesman, Steve Maviglio, called the power firms' accusatio= ns "absolutely false" and said the generators were trying to whip up sentim= ent in Washington to interfere with the state's affairs.=20 "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= ."=20 Oscar Hidalgo, a spokesman for the Department of Water Resources, said gene= rators could hardly cast themselves as victims in California's energy crisi= s.=20 "I don't feel sorry for them one bit," Hidalgo said. "They had one heck of = a year."=20 Gregg Fishman, spokesman for the ISO said the agency was preparing a respon= se to the accusations.=20 Energy trade organizations said they suspected the ISO of using several mec= hanisms to charge suppliers for state contract costs.=20 The extra expense is sometimes tacked on to suppliers' bills for ISO operat= ing costs, which all electricity sellers in California share, Ackerman said= .=20 Some firms say they have tried to buy cheap spot market electricity for res= ale, only to find later that the grid manager has charged them for more exp= ensive state power. Others say the grid operator orders them to activate st= and-by power units on too-short notice. When they can't comply, they say, t= he ISO brings high-priced state power on line and bills them for the extra = cost.=20 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 ch= aired by Smutney-Jones, after some critics said it was too cozy with indust= ry. Davis appointed his own five-member board.=20 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 Californi= a to turn over its grid to a multistate transmission organization.=20 Davis has warned Washington to "keep its hands off" the ISO. Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 Trammell Crow Company Names Rebecca McDonald to Board of Directors 10/09/2001 Business Wire (Copyright © 2001, Business Wire) DALLAS--(BUSINESS WIRE)--Oct. 9, 2001--Trammell Crow Company (NYSE: TCC) to= day announced the appointment of Rebecca A. McDonald to its Board of Direct= ors.=20 McDonald's appointment is effective October 1, 2001, and her initial term e= xpires at the Company's annual meeting of stockholders in 2002. McDonald is currently President of the Houston Museum of Natural Science, o= ne of the nation's premier museums. She formerly served as Chairman and Chi= ef Executive Officer of Enron Global Assets and was responsible for all of = Enron's global energy asset portfolio, including numerous power plants, pip= elines, gas and electricity distribution centers throughout Asia, Africa, t= he Caribbean Basin and South America.=20 Prior to joining Enron, McDonald served as President and Chief Executive Of= ficer of Amoco Energy Development Company, where she was responsible for de= veloping equity interests in international exploration and production opera= tions. She also led the company's participation in and expansion of interna= tional commercial transactions, privatizations and capitalizations. Additio= nally, McDonald was responsible for establishing Amoco's North American tra= ding operations.=20 Prior to joining Amoco, McDonald served as president of Tenneco Energy Serv= ices and held various management positions with Panhandle Trading Company, = Panhandle Eastern pipeline, and Trunkline Gas.=20 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 tha= t will be invaluable as we continue to build our international real estate = services capabilities."=20 McDonald currently serves on the Advisory Committee of the Export-Import Ba= nk 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.=20 McDonald joins board members J. McDonald Williams, Chairman, Trammell Crow = Company; Robert E. Sulentic, President & CEO, Trammell Crow Company; H. Pry= or Blackwell, President, Development and Investment Group, Trammell Crow Co= mpany; William F. Concannon, President, Global Services Group, Trammell Cro= w 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 Chairma= n, EDS; and Rowland T. Moriarty, President & CEO, Cubex Corporation.=20 Founded in 1948, Trammell Crow Company is one of the largest diversified co= mmercial real estate services companies in the United States. In offices th= roughout the United States and Canada, Trammell Crow Company is organized t= o deliver management services, transaction services and development and pro= ject management services to both investors in and users of commercial real = estate. The company's Global Services Group delivers all management, transa= ction and project management services domestically and internationally. Dev= elopment and investment activities are conducted through the Development an= d Investment Group. The company has international service delivery in Europ= e and Asia through its strategic alliance with Savills plc, a leading prope= rty services company based in the United Kingdom, and the jointly owned out= sourcing company Trammell Crow Savills Limited. In addition, the company ha= s 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=20 08:43 EDT OCTOBER 9, 2001=20 Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 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=20 PORTLAND, Ore., Oct 08, 2001 (AP Online via COMTEX) -- Northwest Natural Ga= s Co. is buying another Oregon utility from Enron Corp. for $1.8 billion, c= ombining 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 Monda= y 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 owne= rship," Reiten said at a news conference. Bob Jenks, executive director of the Citizens Utility Board, said he was co= ncerned the combination could encourage Northwest Natural to bypass state r= egulators 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 Legisl= ature and the governor's office, then I don't think that's going to be in t= he interest of PGE customers," Jenks said. Northwest Natural was founded in 1859, the year Oregon became a state, usin= g 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 w= hen it was connected to the city, 14 miles to the north. The plant still op= erates, generating 16 megawatts of electricity. Reiten said the Northwest Natural board of directors has rejected buyout of= fers 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 th= an 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 com= bining repair crews, equipment, service centers and billing in their overla= pping service area. Portland General has about 733,000 customers in northwestern Oregon and Nor= thwest Natural has about 530,000 customers in roughly the same area, includ= ing some in southwestern Washington state. Their headquarters are just a fe= w 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 throu= gh attrition and retirement, rather than layoffs. He said regulators have looked favorably on recent mergers of gas and elect= ric utilities because they generally have saved money for ratepayers. Combi= ned 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 der= egulation in Oregon too slow at a time when the California energy crisis wa= s 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 H= eim, 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 PG= E. Enron stock closed at $33.45 on Monday, up $1.72 per share. Northwest Natur= al was at $22.99, down 42 cents a share. ---
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