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Enron Mail |
Great work!! Absolutely proceed to the next level. Please check with Mark=
Muller re any potential non compete on this...I am certain, though, there = will not be one. In fact, Netco could be our biggest customer! Proably ne= ed someone from corp devt involved once you bring in the the consulting fir= m. I would suggest that the reorganized Enron could provide these services= to Netco, the Estate, the consulting firm, etc. =20 -----Original Message-----=20 From: Beck, Sally=20 Sent: Fri 1/4/2002 7:19 PM=20 To: McMahon, Jeffrey=20 Cc: Perlman, Beth; Piper, Greg=20 Subject: Services Company=20 Beth Perlman has fleshed out an idea for maximizing value for creditors of = the Enron Estate that I believe has a lot of merit. As you may know, one o= f our business goals within Enron Net Works in 2001 was to commercialize mi= d and back office services. With the money and talent that has been poured= into Enron's trading operations systems and processes, we believed that th= ere could be market demand for these services. Ironically enough, we had s= ecured our first services customer and were to begin providing these servic= es on December 1. Understandably, the customer became concerned during Nov= ember and the deal was shelved. Our experience was that there was much int= erest in mid and back office services (coupling our systems and our people)= , but that the major drawback in the marketplace was that it was indeed Enr= on that was offering these services. The market place didn't want us to "w= in again" as Enron. =20 Obviously, the world has changed. While effort is currently focused on the= formation of Netco and how to realize value from remaining contracts withi= n EGM, EIM, EA, EES, etc., I think that we would short-change the Estate if= we did not bring the idea of a services company to at least the proposal s= tage in order to evaluate its potential value for the Estate. The idea wou= ld be to form this services company with a consulting firm, which could pro= vide some capital, additional resource pool and a ready sales channel. Wit= h the potential of spin-off companies from Enron and with former Enron empl= oyees taking jobs with other firms, many doors would be opened for this "in= dependent" services company to provide services. Servicing the Enron Estat= e could be the first engagement for this services company. Depending upon = the structure of the deal, benefits to the Enron Estate could be reduced co= sts for systems and services, perhaps a cash inflow from the purchase of th= e CommodityLogic tools, the possibility of some revenue stream from other = services engagements, etc. Another important aspect of this idea is that f= or the systems and operations professionals, this would create a true caree= r opportunity - a service bureau offering through an established consulting= firm - making it much more likely that these people could be retained. =20 Beth and I met with a consulting firm today to explore the concept. There = is definite interest, so we discussed the idea with Greg Piper today. We a= sked him for clarification around the Netco agreement regarding systems, an= d I believe that he has copied you on a note to Anne Koehler regarding this= . Our ability to process transactions is one of Enron's assets, and our ho= pe would be that we are not limiting the full realization of value around = that asset in the way that the Netco agreement has been drafted. =20 The next step would be to have the consulting firm conduct a short due dili= gence process so that a proposal could be presented for the Estate's consid= eration. Beth and I would like to move forward with the proposal stage. I= t would be helpful to know your view on the process which would have to be = followed to consider the proposal. If we as Enron felt that there is merit= to the proposal, would there simply be an approval process with the Credit= or's Committee and the Court? Would there have to be some sort of open bid= ding process on the proposal? To set expectations within the consulting fi= rm, it would be good to be able to give them a feel for the process. =20 Your thoughts on this idea in general would be welcomed as well. --Sally
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