Enron Corp.‘s liquidating chapter 11 plan accelerated on Wednesday when the company closed the $2 billion sale of its prized remaining assets — its interest in three natural gas pipelines.
Enron’s Bankruptcy Court approved the sale in September of Enron’s interest in the three natural gas pipelines to CCE Holdings LLC, a joint venture of Southern Union Co. and a unit of GE Commercial Finance. CCE Holdings will assume $430 million in debt as a part of the deal.
A $1.25 billion sale of Portland General Electric, which is Enron’s Pacific Northwest utility, is still up in the air pending regulatory approval. If approved, a Texas Pacific Group-backed holding company will acquire the utility and assume $1.1 billion in debt.
Once the Portland General deal closes, the scraps of Enron will become Prisma Energy International Inc., which will own Enron’s remaining pipeline and power assets. When that happens and sufficient claims objections have been resolved (probably sometime in mid to late 2005), Enron will begin distributing dividends to its unsecured creditors. The total amount to be distributed is expected to be approximately $12 billion comprised of 92% in cash and 8% in Prisma stock. That computes to about a 20% dividend on unsecured claims against Enron.
Meanwhile, the Enron name will live on primarily for the benefit of lawyers, who will continue to pursue litigation claims on behalf of the Enron estate for years to come.