HOUSTON, Feb. 20 (UPI) -- The Power Systems business of General Electric Co. agreed Wednesday to purchase the wind-turbine business of Enron. Corp.
The agreement to purchase Enron Wind Corp., a global manufacturer of wind turbine generators, is subject to regulatory and bankruptcy court approval. The sale is expected to close in April 2002, officials said.
GE Power Systems offered $400 million for the Enron wind-turbine business, according to the Wall Street Journal. GE did not disclose the sale price in a press release and officials were not immediately available for comment.
Enron Wind, based in Tehachapi, Calif., has manufacturing operations in the United States, Germany and Spain and a total of 1,600 employees worldwide. The company offers power plant design, engineering and site selection, operations and maintenance services.
"The acquisition of Enron Wind represents GE Power Systems' initial investment into renewable wind power, one of the fastest growing energy sectors," said John Rice, president and chief executive officer of GE Power Systems.
The wind energy industry is expected to grow at an annual rate of about 20 percent, with principal markets in Europe, the United States and Latin America, he said.
Enron said the wind power business had been good for the company but it could not afford to keep it as it tries to restructure under Chapter 11 protection.
"While Enron Wind has historically been a good business with solid returns, its future growth requires more capital than we can justify under current circumstances," said Stanley Horton, chairman and CEO of Enron Global Services, which includes Enron Wind. "The proceeds of this sale will help to repay our creditors. I am confident that the wind company will be a good business for GE."
Enron said the purchase included the company's global wind turbine manufacturing and marketing operations, but not Enron owned or operated wind farms. GE will continue to provide operational support for most of these facilities.
In connection with the sale, Enron Wind also filed a voluntary petition for Chapter 11 bankruptcy Wednesday. It reported $292 million in assets and $293.3 million in debts in the filing, according to the Houston Chronicle. GE was a creditor to the business, owed $9 million according to the filings.
Enron, which still has 20,000 employees worldwide, continues to deliver energy, physical commodities and other energy services to customers.
