GE to Get $75M Back for Enron Wind-Turbine Buy
General Electric Co. (Fairfield, CT) and Enron Corp. (Houston, TX) have entered into an agreement authorizing a $75 million cash refund to GE for its purchase last year of Enron's wind-turbine business. The settlement also requires Enron to put $25 million of the purchase proceeds into a trust to be distributed only to US creditors of Enron's former wind-power business. That provision settles the objection of Mission Iowa Wind Co., which had complained that the original plan gave too much of the purchase proceeds to the unit's European creditors.
As often occurs in bankruptcy cases, the GE/Enron deal allowed for GE to request a refund following a review of the assets it purchased. GE Power Systems bought Enron Wind Corp. (Tehachapi, CA) in May 2002, paying $285.7 million in cash - following an earlier purchase-price adjustment - plus the assumption of about $168 million in debt. Under the settlement, GE will get the cash refund plus rights to collect $14.7 million owed to the Enron unit.