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Date: Thu, 16 Aug 2001 10:18:10 -0700 (PDT)
From: rahil.jafry@enron.com
To: louise.kitchen@enron.com
Subject: FW: WSJ Skilling Interview
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Enron's Skilling Cites Stock-Price Plunge As Main Reason for Leaving CEO Po=
st By John R. Emshwiller  08/16/2001  The Wall Street Journal  Page A2  (Co=
pyright (c) 2001, Dow Jones & Company, Inc.)  Jeffrey K. Skilling said that=
 the pressure he felt from Enron Corp.'s plummeting stock price was the mai=
n reason he decided to resign Tuesday as the energy giant's chief executive=
 officer after only about six months in the job.  In an interview yesterday=
, the 47-year-old Mr. Skilling elaborated on his decision to leave Houston-=
based Enron. On Tuesday, Mr. Skilling insisted he had resigned for "persona=
l reasons" unrelated to Enron's business activities.  In the interview, he =
reiterated that he wasn't under any pressure to resign from the company's b=
oard or Chairman Kenneth Lay, who has resumed the CEO's duties at the natio=
n's biggest energy trader.  However, yesterday Mr. Skilling said that his "=
personal reasons" were deeply enmeshed with feelings that he had failed in =
a crucial business area during his brief tenure as CEO. Calling the company=
's stock performance a "kind of ultimate score card," Mr. Skilling noted th=
at Enron's share price had fallen by some 50% this year.  Mr. Skilling said=
 he took that stock-price drop very personally. "I put a lot of pressure on=
 myself" for that decline, he said. "I felt I must not be communicating wel=
l enough" with investors. He felt this particularly given Enron's strong fi=
nancial results over the past several quarters, based largely on growing vo=
lumes in its trading business, which covers a range of items, including ele=
ctricity, pulp and paper.  If the stock price had remained up "I don't thin=
k I would have felt the pressure to leave," he said.  In January, Enron top=
ped $84 a share in New York Stock Exchange composite trading. It closed Tue=
sday, before the announcement of Mr. Skilling's resignation, at $42.93 a sh=
are. As of 4 p.m. yesterday, Enron traded at $40.25, after falling below $3=
7 during the day.  Mr. Skilling, who had been at Enron 11 years, said the d=
epressed stock price was particularly tough to explain to fellow Enron empl=
oyees, many of whom are shareholders. "People would say `What is going on w=
ith the stock, Jeff?' I would have to say I didn't know. It has been frustr=
ating," said Mr. Skilling.  The self-portrait offered by Mr. Skilling in th=
e interview is rather different from the widely held image of him as an amb=
itious, bright and thick-skinned business strategist whose long-held goal h=
ad been becoming Enron CEO. Mr. Skilling said that the "final straw" in his=
 decision to leave had come on a visit last week to England in connection w=
ith the deaths of three Enron workers in a power-plant accident there. That=
 trip helped reinforce "how tenuous life is," said Mr. Skilling, who has th=
ree children from a previous marriage and recently became engaged.  While M=
r. Skilling said Enron is in "great shape," his departure raised anxiety in=
 the investment community. Merrill Lynch, for instance, lowered its rating =
on Enron to neutral from buy based on "uncertainty" created by the resignat=
ion.  Yesterday, an Enron spokesman confirmed that Mr. Lay plans to name tw=
o executives to the existing "office of the chairman" within the next few d=
ays or weeks. The spokesman said Mr. Lay hadn't yet revealed whom the two w=
ould be. The office of the chairman had consisted of Mr. Lay and Mr. Skilli=
ng. =09

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