Enron’s distressed retreat from power project
|Dabhol plant: looking for
a new owner
It is a distressed sale all right. Yet, until a few weeks back few suspected that Enron's haste to get out of India had anything to do with troubles back home that have subsequently taken it close to bankruptcy.
A quick sale of the $1 billion equity in Dabhol Power, the Indian company it set up, might have bailed it out of a financial crunch in October. But India's slow-moving bureaucrats frustrated any hope of that happening. Now it might have to settle for what it can get for the power plant touted as India's biggest foreign investment - one that Enron CEO Kenneth Lay now calls a bad investment.
In the attrition sparked off by a default by MSEB, the state utility and chief buyer of Dabhol's power, Enron used two strategies to get the Indian government to sort out its problems.