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A year later, as Enron is takes bids on assets, sale seems possible

| Saturday, Nov. 30, 2002

HOUSTON — A year after careening into what was then the largest bankruptcy in history, Enron Corp. could be on the verge of selling its 12 most valuable assets and disappearing from the corporate landscape.

That is, if creditors agree liquidation is their best shot at recouping as much as possible from the company, whose failure was a precursor to a string of business scandals in 2002.

"It looks like it is going to take us over a year and tens of millions of dollars in administrative fees to get to the point that should have seemed obvious from the beginning — Enron should be put up for auction," said Todd Zywicki, a bankruptcy law professor at George Mason University.

Enron is taking bids on the non-bankrupt assets that have generated most of its income for the past year, including Portland General Electric, the Portland, Ore., utility acquired in 1997 that serves 740,000 customers in the Pacific Northwest, and Enron's whole or part ownership in three pipelines.

Spokesman Mark Palmer said final bids and purchase agreements will be in by late December. If creditors favor a selloff, bids will be presented to a federal bankruptcy judge in New York in early January.

"Whether we liquidate or stay together, the question is, 'Are they worth more sold?"' Palmer said. "Or, if the market doesn't value them, will we combine them into a new company that creditors hold equity in• It's a mathematical, economic decision."

When restructuring specialist Stephen Cooper became Enron's interim chief executive last January, he insisted that a slimmed-down Enron would emerge from Chapter 11 within a year, focused on moving natural gas and electricity, much like the original Enron formed in 1985.

Enron, which two years ago ranked No. 7 on the Fortune 500 with $100 billion in revenues, declared bankruptcy last Dec. 2, haunted by shady accounting, hidden debt and inflated profits. Stock that had traded at $90 in August 2000 plummeted to pennies, costing investors millions of dollars and leaving employees and retirees with evaporated 401(k) accounts.

The next day, more than 4,000 laid-off Enron workers streamed out of the company's 50-story headquarters in downtown Houston, facing limited job prospects in a weakened economy.

Now the bankruptcy is a question in the latest edition of the board game Trivial Pursuit. On Tuesday, the anniversary of Enron's mass layoffs, the company will hold its second multiple-day auction of surplus equipment, featuring the signature tilted-E logo signs that used to be outside the headquarters and in its lobby. A similar auction in September netted $3.3 million.

Many of the laid-off workers have found jobs or launched their own businesses in hopes of rebuilding what they lost in retirement accounts and stock options that vanished when Enron collapsed.

Laurie Evans, 39, considered herself lucky when she found a job at another energy marketer soon after Enron sent her packing last year. But she was laid off again after eight months, this time a casualty of cutbacks to combat the industry's weakness after the Enron fiasco.

Evans, who worked in Enron's treasury department and lost $500,000 in the company's stock plunge, sold jewelry door to door to pay the bills and landed a job at Coastal Bank a few weeks ago, glad to leave the energy business behind.

"I try to look at the positive things," the 13-year Enron veteran said, but every day for six months, "I'd drive down the road, thinking I couldn't believe I lost half a million dollars."

Top executives who pocketed millions from stock sales and bonuses are also gone, as are the directors who were in charge while financial shenanigans set Enron on a course for failure.

Investigations by the Justice Department, the Securities and Exchange Commission and other agencies continue.

So far, three Enron workers have pleaded guilty to charges ranging from fraud to false tax returns in agreements to cooperate with prosecutors.

Former chief financial officer Andrew Fastow has been indicted on 78 charges relating to schemes to skim money for himself and others at the company's expense.

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