Case Study: the Enron Bankruptcy
This case study is extracted mainly from two major novels titled “What went wrong at Enron” by Fusaro P.C. and Miller R.M. and “The unshredded truth from an Enron insider” by Brian Cruver.
The Vision Called Enron
The history of Enron goes back to the 1920’s, when a pair of Houston pipeline companies was incorporated to carry gas along the coast of the Gulf of Mexico. In 1956 these companies merged under the name of Houston natural Gas (HNG).
While these companies were working along the coast, another company was building a pipeline network between the Texas Panhandle and the Midwestern United states. Northern Natural gas, which ultimately called itself InterNorth, went public on the New York Stock Exchange (NYSE) in 1947. HNG joined InterNorth on the Stock Exchange in 1968, and they continued to expand their network of pipes through new constructions and acquisitions. In 1985, these two companies merged to create a pipeline system that touched every coast and border of continental United States.
Kenneth lay became CEO of the new company, which he later called Enron. Lay, born in rural Missouri was the son of a Baptist Minister. He Embraced the concept of Enron with a believe which many observers likened to a religious believe. The idea that drove Ken Lay and fueled Enron was that of the power of the free market system. With a PhD in Economics, Lay held many positions before setting off to Enron amongst which was Assistant Professor of Economics at the George Washington University in the United States of America.
In 1987, the new company stated its first vision “to become the premier natural gas pipeline company in North America.” In the late 1980’s, Enron went global with Teesside power plant in England, United Kingdom. The rapid expansion the company experienced in the natural-gas market had necessitated a change in its stated vision. The new vision stated in the 1990’s was “To become the world’s first natural gas major”. Enron was expanding like
The Vision Called Enron
The history of Enron goes back to the 1920’s, when a pair of Houston pipeline companies was incorporated to carry gas along the coast of the Gulf of Mexico. In 1956 these companies merged under the name of Houston natural Gas (HNG).
While these companies were working along the coast, another company was building a pipeline network between the Texas Panhandle and the Midwestern United states. Northern Natural gas, which ultimately called itself InterNorth, went public on the New York Stock Exchange (NYSE) in 1947. HNG joined InterNorth on the Stock Exchange in 1968, and they continued to expand their network of pipes through new constructions and acquisitions. In 1985, these two companies merged to create a pipeline system that touched every coast and border of continental United States.
Kenneth lay became CEO of the new company, which he later called Enron. Lay, born in rural Missouri was the son of a Baptist Minister. He Embraced the concept of Enron with a believe which many observers likened to a religious believe. The idea that drove Ken Lay and fueled Enron was that of the power of the free market system. With a PhD in Economics, Lay held many positions before setting off to Enron amongst which was Assistant Professor of Economics at the George Washington University in the United States of America.
In 1987, the new company stated its first vision “to become the premier natural gas pipeline company in North America.” In the late 1980’s, Enron went global with Teesside power plant in England, United Kingdom. The rapid expansion the company experienced in the natural-gas market had necessitated a change in its stated vision. The new vision stated in the 1990’s was “To become the world’s first natural gas major”. Enron was expanding like