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Gold/Mining/Energy : Enron - Natural Gas Industry
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To: buffaloha who wrote (951)11/30/2001 8:20:02 AM
From: Bob Rudd  Read Replies (2) of 1433
 
buf: Got this out of a NYT article - selected excerpts:
DYN Moody's Investors Service said that it was considering a downgrade of Dynegy's credit rating because of potential liabilities from litigation with Enron. Shares of Dynegy closed at $33.65, down 8.4 percent, or $3.08.

"It remains uncertain whether or not the company will face legal challenges from Enron," Moody's (news/quote) said, adding that it "will continue to monitor any potential consequences of the merger termination and any subsequent impact on Dynegy's capital structure and liquidity."

A person close to Enron asserted yesterday that Dynegy delayed the renegotiation of the merger, and the delay contributed to the deterioration of Enron's core energy-trading business. He also said Dynegy sharply curtailed trading with Enron last week, and that further hurt Enron's business as word leaked to other energy traders.

Interviewed yesterday on CNBC, Chuck Watson, Dynegy's chairman, reiterated that Dynegy has a clear right to acquire the pipeline, and he said Dynegy kept trading with Enron until Wednesday, though it had curtailed its exposure to the company.

Enron stopped short of saying it would sue Dynegy. But executives close to the company say lawyers have been preparing documents for a possible lawsuit that would seek damages of more than $350 million, the amount of the breakup fee in the merger agreement if either party walked away from the deal for reasons other than a material adverse change in the business. Mr. Watson has said he does not believe either side owes the fee.
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