Message-ID: <31950101.1075858877037.JavaMail.evans@thyme> Date: Tue, 23 Oct 2001 05:28:12 -0700 (PDT) From: karen.denne@enron.com To: pr <.palmer@enron.com>, j..kean@enron.com Subject: BusinessWeek Questions Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit X-From: Denne, Karen X-To: Palmer, Mark A. (PR) , Kean, Steven J. X-cc: X-bcc: X-Folder: \SKEAN (Non-Privileged)\Kean, Steven J.\Deleted Items X-Origin: Kean-S X-FileName: SKEAN (Non-Privileged).pst I think it's worth answering most of these, and possibly putting up Greg for an interview? -----Original Message----- From: Stephanie Anderson Forest @ENRON Sent: Monday, October 22, 2001 7:39 PM To: kdenne@enron.com; Stephanie Forest Subject: questions hi karen, as discussed, here are the questions i'd like to run by ken lay, greg whalley, mark frevert or one of enron's other top execs. as mentioned, because of continuing breaking news on enron, the deadline for the story has been pushed up by several days. thus, i would need to get responses back by end of day tomorrow, oct. 23. if necessary, i could probably get editors to extend that deadline to first thing wednesday morning, providing it's absolutely necessary to get cooperation from enron for this story. i'd obviously prefer to speak with someone by phone. but if that's not possible, feel free to just have ken, or whomever might be handle the questions, respond by e-mail. -when i interviewed ken lay following jeff skilling's resignation, he insisted there was "no other shoe to drop." according to many analysts and investors i've spoken to in recent days, the events over the last few days appear to be a pretty big shoe -- or shoes. what gives? -were any of these events tied to jeff skilling's resignation? -what's ken lay's strategy for getting enron back on track? -how difficult is that task shaping up to be? -what role will wholesale energy services and retail energy services play in that? -what role will european expansion play in that? -is there a connection between the recent announcement of a 10-15% staff layoff in european operations and flat 3q earnings even while revenues rose? -what role will some of the newer investments, such as broadband and new power, play going forward? -why did new power account for such a big portion of the 3q $1.01 billion write-off? explain the challenges facing new power. -how have some of the other newer commodity trading businesses, such as pulp and paper and steel, been faring? why did others, such as advertising, not pan out? -is it fair to say it appears enron's trading methodology is not expandable to just about all commodities after all, like jeff skilling suggested in the past? -if that is the case, will enron be less willing to experiment with attempting to expand the model to new areas in the future? -what impact, if any, will falling energy prices have on enron? -have investors seen the last of write-offs or will there be more? if so, how much more, in what areas and when could that happen? -at least one analyst has estimated there could be at least $3 billion more worth of charges related to other off-balance sheet financing vehicles. how many such vehicles does enron have and is this estimate in the ballpark? -please explain the reason for these vehicles (i.e. what did enron get out of doing them) and how they work? -how many of these off-balance sheet financing vehicles are there? like the deals involving andy fastow, will they ultimately be unwound, too? -is osprey a good example of one these vehicles? how does it work? will it ultimately be unraveled, too? -in all, how many of these off-balance sheet financing vehicles was andy fastow involved in -- some sources say as many as 14 or 15 more that enron has not yet disclosed? -how much did andy fastow and other enron execs make off of these deals? -while these deals were approved by the board, didn't ken lay or the board see the potential for conflict of interests in these deals? -also, while these off-balance sheet vehicles were designed to limit enron's risks, weren't they themselves risky considering what could happen if enron's stock dropped? -any response to the lawsuits that are starting to pour in as a result of the andy fastow-related partnerships? -any concern about enron's investment grade? what are the implications if that drops for the company? -enron's relationship with wall street has been unraveling for some months now. where does ken lay think the company went wrong in it's relationship with wall street -- overhyping broadband, lack of disclosure, etc.? -despite more transparency in last week's earnings report, wall street says that should only be a start. is there more transparency to come? -what's ken lay's strategy for regaining credibility with wall street? -how long will it take to achieve that? -what lessons, if any, has ken lay learned from the events of the last few months? that should do it. give a call if you have any questions. thanks, stephanie