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Small US power company plans Enron takeover

Standard Power & Light, a little-known power plant acquisition and development company, said on Monday it intends to launch a tender offer to acquire a majority of troubled Enron Corp shares and reorganise the company.

Oak Brook, Illinois-based Standard Power, a privately-held firm that currently owns no assets, employs 11 people and generates about $1.5 million in annual revenue, said it is preparing a tender offer to acquire "at least a majority" of Enron's outstanding shares for less than $1 per share, according to a filing with the U.S. Securities and Exchange Commission.

The company would then sell off the non-energy related businesses, farm out the operation of the company's trading and energy pipeline operations and ultimately retire the company's massive $17 billion debt load through a 'long-term reorganisation'.

Standard Power president Richard Ryan said in an interview that he did not currently have plans developed to determine what, if any, compensation Enron's bondholders would receive, but he planned to talk to all parties involved.

The bid joins a number of recent obscure takeover offers for once-high flying US companies from relatively unknown quantities, including entrepreneur Emil Bernard's $1.8-billion offer for US Airways earlier this year.

Such bids are often considered fairy tales on Wall Street, but the US Securities and Exchange Commission rarely launches investigations into them unless there is clear evidence of a stock scam.

An Enron spokesman said his company had not seen an offer and therefore could not comment on it.

Ryan said he could not yet provide exact details on how he intended to finance such an acquisition, but did say he already had firm financing commitments in place from public and private sources to fund at least part of the deal.

"We have an idea on price that we want to offer and based on that price, we have a portion of that assembled and committed to a tender offer," he said.

Enron shares traded up 11 cents, or 42.3 per cent, to 37 cents in late morning trading on the New York Stock Exchange Monday. Last week, Dynegy Inc. walked away from an agreement to acquire Enron for about $9 billion. Standard Power's offer would likely value the Houston energy company at less than $700 million.

Ryan said he hoped to hold a news conference next week to announce his proposed management committee for Enron and the exact details of his tender offer.

"I believe this company has the ability to retire its debt and make a nominal return on investment, but it's going to take a long time," he said.

Ryan, who co-founded Standard Power to develop power plants six years ago and then sold most of the company's assets to his partners earlier this year, admitted he had little experience in Enron's core energy trading, or the pipeline business.

He said, however, he would bring in the experience necessary to run those operations.

"I will bring people to this acquisition that will make up for my own deficiency," Ryan said. "The goal right now is to maintain our focus on two things: to make sure the filings are done on time and that the management team is in place."

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