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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Logain Ablar who wrote (5013)	11/13/2001 11:12:49 AM
From: John Pitera	Read Replies (1) \| Respond to of 33421

Tim, right you are the ENE seems to have "double booked" it's Northern Natural Gas Pipeline.... also SSB is talking about the deal not closing until Q3 of 2002, which is a long way off, considering the Trading, market Making and counterparty issues, that are reducing ENE's ability to trade. --------Exit Provisions One of the most important, and cloudy, considerations of this deal, in our opinion, is the ability of Dynegy to withdraw from the deal in case Enron's financial and legal situation should deteriorate further. The contract does contain Material Adverse Change (MAC) clauses, however it is our understanding that they are general in nature, and without specific trigger mechanisms. If Dynegy were to exercise its option to exit the transaction, it would have claim on the company's Northern Natural Gas Pipeline, estimated to have a value of $2.25 billion. Our main concern regarding the claim on these assets is the fact that these are the same assets which back the recent $1 billion credit facility that Enron entered into last week.----- and The Financial Times is saying that Moody's will downgrade DYN's debt now. --------------------- THE TIMES: CREDIT DOWNGRADE EXPECTED AT DYNEGY Nov 13, 2001, (The Times /FT Information via COMTEX) -- Moody's yesterday placed Dynegy's Prime-3 and Baa2 ratings under review for anexpected credit downgrade following the company's $9bn (GBP6.2bn) takeover of rival energy trading group Enron. Dynegy's debt will be affected by the uncertain financing status of its troubled competitor. The credit ratings agency lined up Dynegy for a downgrade even with an expected equity investment by ChevronTexaco worth $1.5bn. The agreement between Enron and Dynegy is also expected to cause regulatory concern, as the arrangement will establish a dominant energy trading entity. Abstracted from: The Times (UK Abstracts)