PwC insolvency team kept busy over Enron
The Big Five firm was appointed administrator to seven legal entities and liquidators to five in November and now has to find buyers for thousands of companies and contracts.
Administrator Steven Pearson said the administration had been extremely difficult from the start, as Enron Europe was financed by the Enron Corp in the US.
He said: ‘As soon as the US company filed for bankruptcy all the money from the European companies went to Enron Corp, so there was no cash to run the European businesses from the beginning.’
With all of Enron’s money in the US, no cash, thousands of creditors, and 2,000 employees, PwC had to raise cash quickly. ‘We had to make exceptionally difficult decisions,’ added Pearson.
‘Within a week we had negotiated the sale of Enron Direct to British Gas for £96.4m. Its business was to supply gas and electricity to small and medium-sized companies, but no customers were cut off. Then we could go systematically through the books.’
There were also a series of contracts in coal, which PwC amalgamated and sold, and they did the same with power and gas businesses. ‘(In the UK), we have sold three businesses and are in the process of selling the metals business. We have also worked through thousands of trading contracts,’ Pearson said.
Among Enron’s UK creditors are Abbey National, Centrica and Barclays.