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8/16/01 WSJ A2
8/16/01 Wall St. J. A2
2001 WL-WSJ 2872852

  The Wall Street Journal
Copyright (c) 2001, Dow Jones & Company, Inc.

Thursday, August 16, 2001

Enron's Skilling Cites Stock-Price Plunge As Main
Reason for Leaving CEO Post
  By John R. Emshwiller
  Staff Reporter of The Wall Street Journal

Jeffrey K. Skilling said that the pressure he felt from
Enron Corp.'s plummeting stock price was the main
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 "personal 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 board or
Chairman Kenneth Lay, who has resumed the CEO's
duties at the nation'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 that 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
well enough" with investors. He felt this particularly
given Enron's strong financial results over the past
several quarters, based largely on growing volumes in
its trading business, which covers a range of items,
including electricity, pulp and paper.

If the stock price had remained up "I don't think I
would have felt the pressure to leave," he said.

In January, Enron topped $84 a share in New York
Stock Exchange composite trading. It closed Tuesday,
before the announcement of Mr. Skilling's resignation,
at $42.93 a share. As of 4 p.m. yesterday, Enron traded
at $40.25, after falling below $37 during the day.

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Mr. Skilling, who had been at Enron 11 years, said
the depressed stock price was particularly tough to
explain to fellow Enron employees, many of whom are
shareholders. "People would say 'What is going on
with the stock, Jeff?' I would have to say I didn't know.
It has been frustrating," said Mr. Skilling.

The self-portrait offered by Mr. Skilling in the
interview is rather different from the widely held image
of him as an ambitious, bright and thick- skinned
business strategist whose long-held goal had 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 with 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 three children from a previous
marriage and recently became engaged.

While Mr. 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 resignation.

Yesterday, an Enron spokesman confirmed that Mr.
Lay plans to name two executives to the existing
"office of the chairman" within the next few days or
weeks. The spokesman said Mr. Lay hadn't yet
revealed whom the two would be. The office of the
chairman had consisted of Mr. Lay and Mr. Skilling.

---- INDEX REFERENCES ----

COMPANY (TICKER): Enron Corp. (ENE)

NEWS SUBJECT: Analysts' Comments & Ratings
of Stocks; Analyst Comment/Recommendation;
Corporate Actions; Corporate/Industrial News;
Corporate Officers; Management Moves; Personnel
Announcements; Stock News; Dow Jones Total Market
Index; Wall Street Journal; English language content;
Earnings Projections; Performance; Management
Issues (ANL C1521 CAC CCAT COF C411 PER STK
WEI WSJ ENGL C152 C15 C41)

MARKET SECTOR: Utilities (UTI)

INDUSTRY: Gas Utilities (GAS)

PRODUCT: Analysts' Ratings/Comments; Oil &
Gas; Utilities; Embargoed Journal Stories (DAR DGA
DUT EMB)

Copr. Z West 2002 No Claim to Orig. U.S. Govt. Works

EXH023-00162

GOVERNMENT
EXHIBIT
  960
  Crim. No. H-04-25 (S-2)


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8/16/01 WSJ A2

REGION: North America; Texas; United States;
United States; Southern U.S.; North American Word Count: 527
Countries (NME TX US USA USS NAMZ)
  8/16/01 WSJ A2
LAYOUT CODES: Large Majors; Business and
Finance Column Stories (LMJ TPT) END OF DOCUMENT

Copr. © West 2002 No Claim to Orig. U.S. Govt. Works

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