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Enron Mail |
On November 8, the Office of the Chairman, issued an important communicatio=
n,=20 announcing significant organizational changes in Enron's worldwide=20 operations. The purpose of this memo is to share with you the decisions tha= t=20 are underway to restructure Enron=01,s operations in South America. The b= asic=20 organizational framework has been set.=20 As you know, Diomedes Christodoulou and Jim Bannantine will be assuming new= =20 responsibilities within Enron. Replacing them will be Orlando Gonzalez and= =20 Joe Kishkill, who will become the Co-Presidents of South America, reporting= =20 to Dave Delainey and John Lavorato. They will share overall responsibility= ;=20 however, Orlando=01,s focus will be on direct sales origination,=20 commercial/government relationships and regulatory issues. Joe=01,s focus = will=20 be on wholesale origination, financial and operating performance and overal= l=20 country management. In addition, Orlando will continue as President and CE= O=20 of Elektro until its ultimate sale. The existing, large integrated asset base in South America (excluding=20 Elektro) will be managed and operated by Rebecca McDonald and Jim Hughes in= =20 Enron Global Assets, which is part of Enron Wholesale Services under Mark= =20 Frevert. Ultimately, there will be very close coordination in both Brazil a= nd=20 Argentina between Enron Americas and Enron Global Assets to ensure that our= =20 reputation in South America is protected, our asset positions are being=20 managed prudently and that commercial opportunities surrounding these asset= s=20 are pursued. The remaining natural gas and electrical commercial activities in South=20 America will be organized around the highly successful North American netwo= rk=20 business model. This model employs people, market making, physical=20 commodities, capital and assets to provide reliable, flexible and high-valu= e=20 products to our customers. It is people and intellectual capital based and= =20 enjoys high rates of return on invested capital. In the interest of pursuing this strategy, the following teams will report = to=20 Joe and Orlando: =20 The Commercial Origination team will be lead by Brett Wiggs. The team will= =20 focus on covering South American markets, primarily Brazilian and Argentine= =20 natural gas and electricity, with the following goals: ? Generating new, innovative, reliable and high value products and services= =20 needed by the market by utilizing our commodity, asset and capital=20 capabilities; ? Providing those products and services across South America and across the= =20 value chain, including wholesale and retail, based upon the highest value= =20 opportunity; ? Finding structural value arbitrages in the South American market and move= =20 quickly to capitalize; ? Assisting the Risk Management and Trading organization in managing the=20 overall risk of the organization; ? Managing all new power and asset development opportunities in South Ameri= ca=20 consistent with this strategy, and ? Providing the Risk Management and Trading organization information and de= al=20 flow. The Commercial Origination team will consist of a diverse group of people w= ho=20 work as a single team which bring the required skills including commodity,= =20 capital, regulatory, asset, development, market, structuring, deal executio= n,=20 finance and country knowledge necessary to reach our goals.=20 The Trading and Risk Management team will be headed by Remi Collonges. The= =20 team will continue to develop pricing information and manage the price book= =20 for the relevant energy markets in support of the wholesale and direct sale= s=20 efforts. Additionally, the team will work toward implementation of activel= y=20 trading South American energy commodities. This group will be responsible= =20 for managing Enron South America=01,s overall risk and will have a direct= =20 reporting relationship with John Lavorato in his role as head of the Americ= as=20 risk activities. The Argentine effort will be integrated into the overall South American=20 Commercial Origination and Trading and Risk Management groups; however, we= =20 will continue to maintain an Argentine office headed by Michael Guerriero. = =20 The goal of the reorganization is to create a flat team oriented organizati= on=20 that is very market and commercially focused. The following support=20 functions will assist the overall business objectives of the commercial tea= m=20 and will report into Joe and Orlando, plus into their line functions in=20 Houston. The overall goal is to ensure that the South American business=20 units have an adequate support organization to evaluate opportunities, as= =20 well as manage day-to-day business and risk. Otherwise, the Houston=20 infrastructure will provide resources as needed to manage peak requirements= =20 in South America, not unlike other businesses in Enron Americas. These groups include: The Government Affairs team, which will be headed by Sergio Assad, will=20 manage the relationships with the relevant regulatory agencies as well as= =20 governmental ministries. The primary regulatory goal will be to facilitate= ,=20 in the near term, substantive changes to the regulatory rules to allow a=20 functioning wholesale traded market in Brazil and Argentina. Sergio will=20 assume his responsibilities upon completion of the Elektro sale. During th= is=20 interim period, Jose Bestard will continue to be in charge of the regulator= y=20 function. Once Sergio makes the transition, he will also report to Rick=20 Shapiro in Enron Government Affairs. The Finance team will be headed by Britaldo Soares. The team will manage t= he=20 interface with Enron Global Finance. Britaldo will transition from his=20 current duties at Elektro upon completion of the Elektro sale. Britaldo wi= ll=20 also report to Joe Deffner in Enron Global Finance. Rob Gay will be=20 assisting Britaldo during the transition, while continuing his work on the= =20 Cuiaba project. The Legal team, which will be lead by Randy Young, as general counsel, and= =20 John Novak, as deputy general counsel, will manage South America=01,s legal= =20 requirements. Randy and John will also report to Mark Haedicke in Enron=20 Wholesale Services - Legal Department. Miguel Padron will become Chief of Staff. Human Resources, Information=20 Technology, Treasury, Accounting & Reporting, as well as Administration wil= l=20 report to Miguel. This will bring focus to essential, but non-commercial= =20 functions, as well as more efficiently manage key matrix reporting=20 relationships with Enron. Miguel will also report to David Oxley in Enron= =20 Wholesale Services =01) Human Resources and Wes Colwell in Enron Wholesale= =20 Services =01) Business Analysis and Reporting. These changes are consistent with Enron's evolving business strategy and=20 reflect our continuing commitment to grow the company by maximizing our=20 financial and intellectual capital. However, in line with the new=20 organizational structure and the near term potential for business in the=20 region, further budget reductions will be necessary. People directly=20 affected will be notified shortly. =20 Enron is committed to continue the successful implementation of its=20 businesses in South America. We believe that as the markets develop, we ar= e=20 uniquely positioned to leverage Enron=01,s core capabilities and create=20 shareholder value.
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