Joint Venture Wins Enron Pipeline Auction

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Joint Venture Wins Enron Pipeline Auction
Wed Sep 1, 2004 09:26 PM ET

NEW YORK (Reuters) - Enron Corp. (ENRNQ.PK: Quote, Profile, Research) on Wednesday said a joint venture of Southern Union Co. (SUG.N: Quote, Profile, Research) and a General Electric Co. (GE.N: Quote, Profile, Research) unit won the auction for its crown jewel U.S. pipelines with a $2.45 billion cash and assumed debt bid.
The sale price represented a $100 million premium over the original $2.35 billion Southern Union/GE Commercial Finance Energy Financial Services bid for the U.S. pipelines, which were bundled into CrossCountry Energy Corp.

The so-called stalking horse bid gave other companies or investment groups an opportunity to beat that offer in the auction, which was held Wednesday at the Bankruptcy Court for the Southern District of New York. A stalking horse allows distressed companies to set a higher bar for bids on their assets.

Two other bids were submitted for CrossCountry, but Enron rejected those offers in favor of the revised stalking horse bid.

http://reuters.com/newsArticle.jhtml;jsessionid=LNA42KGMO3HRCCRBAEOCFEY?type=businessNews&storyID=6129761