PwC to consider litigation over Enron Europe

Administrators Dipankar Ghosh, Tony Lomas, Steven Pearson and Neville Kahn met with creditors today in London to give a progress report on raising cash from profitable contracts, selling former Enron businesses and quantifying liabilities.

Speaking to journalists after Friday’s creditors meeting, Lomas said: ‘There are significant counter party contracts. If we need to litigate and have to chase, we will litigate.’

But, they would not comment on individual contracts or claims, nor would it comment on the conduct of the auditors, Andersen.

Lomas added that liabilities can still arise and that there are large deficiencies in each and every company involved. ‘Assets that were there previously aren’t there now,’ said Lomas.

PwC has already confirmed that liabilities at Enron Europe, the holding company for the European companies, are likely to run into the ‘billions of pounds’.

PwC fees will cost ‘tens of millions of pounds’, but would probably not be on the same scale as that of BCCI which ran into the hundreds of millions of pounds to resolve.

Administrators said it would probably take another six months to resolve the main part of the insolvency process, but the rest could ‘take months, even years to resolve’.

Creditors were said to be ‘impressed’ with the work PwC has done so far and unanimously passed all the firm’s proposals at today’s meeting. Administrators will update creditors every six months.