Naomi Rovnick
In its third major corporate deal for the energy and telecommunications powerhouse this year, Ashurst Morris Crisp advised Centrica on its £94m acquisition of Enron Direct. Centrica's principal corporate adviser Linklaters was also involved in the deal, advising Enron's administrators PricewaterhouseCoopers.
Enron, the multinational energy trader, went into administration on 29 November. At the time, Linklaters was working for the company on a planned, and subsequently unsuccessful, merger with rival Dynegy. When Enron went into administration, Linklaters was retained by PwC.
Centrica instructed Ashursts on its auction bid for the assets of Enron Direct on 30 November.
Enron Direct is part of Enron Europe, which, with its parent company Enron, is also in administration. Enron Direct serves a customer base of 148,000 electricity customers and 12,000 gas customers in the small and medium-sized enterprises sector.
Ashursts completed due diligence and other general corporate work on Centrica's successful bid. The deal was completed in just four days.
Ashursts head of energy, transport and infrastructure Michael Johns led a four-partner team on the acquisition. He was assisted by partners Jeremy Sheldon, Patricia Allen and Hugh Lumby, and five assistants.
Johns said: "There were two reasons why the process had to be so quick. First, we didn't know who the other bidders were. Second, Ofgem was anxious to hurry it up so that Enron Direct's gas and electricity customers were provided for."
Banking partner Tony Bugg led the Linklaters' team that advised PwC.
This is not the first time Centrica has turned to Ashursts instead of main adviser Linklaters for corporate work. Earlier in the year, Ashursts advised the company on its acquisition of OneTel, the UK's biggest indirect access telecoms company, after it collapsed into insolvency. Linklaters was advising one of OneTel's major shareholders at the time of the sale, but Centrica general counsel Grant Dawson said that he was unaware of the conflict when he instructed Ashursts. "I thought Ashursts would be best for this particular deal," he said.
Ashursts also acted for Centrica when it bought a stake in Humber Power in May.
Despite this work Dawson does not consider Ashursts to be his main corporate adviser alongside Linklaters. "Ashursts has advised us on a lot of deals this year, but Linklaters has as well. While we have used Ashursts for energy-related work for many years, Linklaters remains our main corporate adviser," he said.
