Energy powerhouse Enron decided to test its mettle once againlast week, offering British metals trader MG Plc $4.46 per sharecash offer in its bid to enter a new marketplace. The bid values MGat $445 million (300 million pounds sterling).
No one was happier about the takeover bid than MG executivechairman Tom McKeever. He said the sale will allow his London-basedcompany to grow the business “more aggressively,” calling Enron a”global trading powerhouse.” He said that the move will allow MG tobecome the “largest, most highly respected, most successful metalstrading business in the world.”
The bid offer had been expected, according to analysts. MG is aleading member of the London Metal Exchange (LME), and yesterday,its shares rose 8.11%. Enron’s Chairman and CEO Kenneth Lay said hehad been watching the global metals market “for several years,” andbelieved it was time to enter the $120 billion market.
“Our business model, which we have proven in the natural gas andelectricity markets, will give us a tremendous advantage in anindustry that is undergoing fundamental change,” Lay said.
This latest acquisition of Enron’s may be the last for awhile inthe metals market. Enron Europe CEO and Chairman John Sherriff saidhe expected the MG acquisition to grow “organically.” The MG metalsweb platform is expected to enhance Enron’s e-commerce portfolio.The Enron Online trades about 840 products in 13 countries and in11 currencies, according to Enron. Since last November when it waslaunched, the site has had 114,000 on-line transactions valuing $45billion, Sherriff said.
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