legendary trader

Chapter 852 853 Confession and self-help

On Tuesday morning, the city of York came to life again, the roads were full of traffic and people.

As Enron’s spokesperson announced the latest news about Enron on the morning TV news, the company has submitted documents to the US Securities and Exchange Commission. Enron admitted that in the five years from 1997 to 2001, the company had falsely reported profits of 5 million. Mi Yuan also admitted that the company has huge unrecorded debts.

Because the news came out very suddenly, of course, some reporters may have heard the news before, but because of the lack of supporting materials, they were worried that they would be sued by Enron for spreading rumors after they appeared in the newspaper, so before Enron’s statement, all American paper media did not report this news.

At this time, the disadvantages of the paper media came out. The morning paper had already been printed and sold, and it was impossible to increase the content. The fastest paper media could report on the evening paper. As for the morning paper, which occupies the absolute majority, then Just wait until the next day's newspaper.

As for the paper media, there is another way, that is to temporarily issue an additional issue of the newspaper, which is what we commonly call an extra issue, which is impossible.

After all, the force is still a bit lacking. If the world's largest company declares bankruptcy without warning, adding an extra account is justified, but Enron, forget it.

Just when everyone was staring at the TV screen, thinking that the news program would stop, the spokesperson of Enron Company did not intend to leave the stage, nor did he pay attention to the reporters who had already raised their hands in the seats below and wanted to ask questions. From the bottom of the document in front of him, he pulled out another document and placed it on top, and rearranged the position of the microphone.

Immediately, the dense crowd of reporters in the audience withdrew their hands one after another. They knew that the news that the spokesperson seemed to be releasing to the outside world was not finished, and there should be more news to be announced.

This is also the second time that Enron has held a press conference in the past month. The previous time it was a short press conference because of the release of the third quarter financial report, and after quickly reading out the company statement, the spokesperson left quickly. Did not accept live questions from reporters.

Soon, the spokesperson on the stage began to read out a new statement from Enron. In this statement, Enron not only acknowledged all the problems involved in the documents submitted to the US Securities and Exchange Commission, but also made serious remarks to the society and all shareholders. apologized.

At the same time, it also explained the current difficulties faced by the company. Due to the urgent shortage of cash and the notification from the rating company that the rating of Enron's long-term and short-term bonds was downgraded, it was unable to continue issuing short-term bonds to raise funds and due to the downgrade of the rating, debts need to be repaid in advance. , Enron began merger negotiations with Deneng, and the progress of the negotiations will be announced in accordance with relevant regulations.

After the press spokesman finished reading out the contents of the document in his hand, like the previous few times, he turned around and left without paying attention to the reporter who raised his hand below.

All of this was completed before the opening of the rice stock market. It should be said that Enron's timing was very precise. It knew that many things could no longer be delayed. Now the company's headquarters is surrounded by reporters from major media around the world. No matter what they do at this time Nothing can be kept secret.

After the US Securities and Exchange Commission took away a large number of internal documents, Enron's top management actually knew that what they had concealed before would definitely be exposed. Continuing to cover up would no longer help, and voluntarily acknowledging it would be more effective than being found out.

At the same time, at the end of the press conference, it also gave the market a little bit of good news. At least Enron did not sit still. The company has already started to prepare for mergers and acquisitions, so the company will not collapse.

Chen Fan was sitting on the computer chair. At this time, he was not facing the computer, but turned slightly to look at the huge TV on the wall. At this time, the photographer was shaking the camera on the TV screen to film the press spokesman of Enron Company leaving. back.

"It's really a virtue."

Chen Fan suddenly smiled and said to Zhang Quan.

"After the market closed in the early morning, our people noticed that the bosses of the two companies appeared together, and they were basically sure what they were negotiating with. They just didn't expect them to release this news before the market opened today."

Zhang Quan said beside him.

"Now the stock price has fallen too much. They can't find anything to stimulate the stock price. They can only release this news, hoping to stabilize the stock price."

At this moment, Lin Hong also interjected.

"It's useless for institutions, but for Enron's current situation where most of the market is retail investors, merging with Deneng is a good way to stabilize the confidence of holding shares."

Zhang Quan laughed.

"With Enron's current situation, what else can they use to negotiate with Deneng? Although their assets are indeed more than Deneng's, they are probably on the weak side. Keep following them. It would be best if they can get their final transaction price. .”

Chen Fan said to Zhang Quan.

Indeed, Enron currently has too few bargaining chips, and its position in the M&A negotiations with Deneng must be very bad. Therefore, Deneng, which appeared as a white knight, will definitely put forward more proposals on the negotiating table. Ask for more benefits.

"The market will open soon, maybe Enron will resist today, but it is estimated that the stock price will continue to decline in late trading and tomorrow."

Lin Hong nodded after hearing Chen Fan's words, and then said.

It is reported today that Enron is seeking to save itself through mergers and acquisitions. It is definitely a good thing for today's market. At least it is much better than before, knowing nothing but knowing that there is a problem and something big will happen.

After clarifying the company's problems, it is to falsely report a profit of several hundred million yuan, and then there is a pile of debts that have not announced the specific figures, so that everyone can understand the company's problems, and then come up with a merger and acquisition plan to stabilize the stock price. It rebounded back, but it is certain that it will stop falling and stabilize.

There will only be very few investors who will see Enron's disadvantageous position in this M&A negotiation, but when it comes to the financial programs in the afternoon and evening, it is obvious that those brick-and-mortar analysts will talk to investors about it. Shit, let them know the inside story of such negotiations.

"They really only inflated more than 5 million profits?"

Lin Hong suddenly turned to Zhang Quan and asked.

Zhang Quan shrugged, "I don't know where to go, but I don't think it's credible, but there are some things, financial things, it's really hard for you to say, for example, the 12 billion yuan buyout fee, if the third quarter financial report If no adjustments are made, the profit in this statement will be more than 17 billion if it is an inflated profit.

Also, how many assets in their financial reports are goodwill, or so-called asset appreciation items. Enron has bought a lot of projects and invested in many new businesses in the past few years. It is estimated that many of these figures will be greatly discounted.

However, according to the financial system, they do not need to accrue impairment, that is to say, they did not lose money on these investment businesses, but when they actually traded, the transaction price may be much smaller than the number on the book, and there is no transaction in the project. Previously, these losses could not be accounted for. "

"It's better to liquidate the liquidation, and you will know what it looks like after the liquidation."

Lin Hong suddenly laughed.

At this moment, Zhang Quan's mobile phone rang. Zhang Quan answered the phone and said a few words, then put down the phone after listening for a while, "Deneng Company also issued an announcement, and the company is negotiating for an acquisition from Enron Company."

"I'm still wondering, Enron's spokesperson said M&A negotiations, now I understand, it's actually Enron selling itself, and M&A just sounds a little nicer."

Lin Hong is still smiling. This transaction is very tiring. It has been more than 2 months since the preparations began at the end of February, and it is finally coming to an end soon.

Once the acquisition negotiations between Enron and Deneng are completed and the final share price of Enron is determined, it is clear that this transaction will come to a perfect conclusion.

Of course, Chen Fan may also close the position in advance to close the transaction, but this is not important anymore, because that will only advance the time for his vacation.

Thinking of this transaction and the commission that can be obtained, it is really refreshing. No wonder He Li and the others showed envious and jealous eyes after knowing that he followed Chen Fan's operation, it was so relaxed.

The timing of buying and selling was decided by Chen Fan, and he was only in charge of the operation, and it seemed that they were all big projects with considerable profits.

Lin Hong has already learned some details of the previous transaction from He Li, knowing that they got a lot of money that time.

Although they are tight-lipped about the types of transactions, all fools know when they disappear and when they come back, and what changes have taken place in the global financial market during this period.

After the rice stock market opened, Enron's stock price fluctuated a little at the opening, then the stock price gradually stabilized and began to fluctuate around 5.8 yuan.

What can influence the trend of Enron's stock price now is the acquisition negotiation between Enron and Deneng, and the final negotiation price will determine the final transaction price of Enron's stock.

At the initial stage of the current negotiation, it is impossible for any news to come out, so investors who still hold Enron shares at this moment can only choose to wait, wait for the news of the negotiation to come out, and then decide what to do next. Sell ​​it or keep it.

However, in the next few days, the media did not end the investigation of Enron because of Enron's guilty plea, and more news gradually began to appear in the newspapers and were disclosed one after another.

Enron's stock price began to slowly fall again as more and more debts were not included in the financial reports, and Enron's previously concealed huge debt figures continued to inflate.

Apparently, every time the debts that are exposed to light are disclosed, Enron’s weak position is increased by one point in the already difficult acquisition negotiations. After seeing these data, investors instinctively know that the final transaction conditions will definitely be worse.

As for who is sending these materials to the media at this time, it is no longer important, because there are too many people who have this information.

Up to now, although the US Securities and Exchange Commission has obtained a large number of Enron's confidential documents, but because the number is too large, it has not yet been fully counted.

Several well-known accounting firms in the US other than Arthur Andersen have already sent personnel to participate in the review of Enron's confidential documents. According to the spokesperson of the US Securities and Exchange Commission, "We are working overtime to calculate the data and strive to get it as soon as possible. Take out the final audit data."

At this time, not only Enron was in turmoil, but Arthur Andersen, once a world-renowned accounting firm, was also on the cusp.

In every report related to Enron, there must be words that are extremely unfavorable to Arthur Andersen.

Yes, now the fire has completely burned to the head of Andersen, a world-renowned accounting firm.

No one believed the words of Andersen's press officer, "We are also victims, we were deceived by them."

Enron's financial fraud has involved a long period of time. If it only started in the last one or two years, as a long-term cooperative firm, it is understandable to be negligent. However, as the firm that has been responsible for the financial audit of Enron, Committing such a serious problem is unacceptable.

After the previous stock market crash, many clients of Arthur Andersen's listed companies cut off their business contacts and issued announcements that they would introduce other accounting firms in the new year's financial audit.

That is to say, Arthur Andersen is a partnership company and is not listed, otherwise their names will be added to the plummeting stocks at this time.

But just when everyone thought that the Enron incident was almost like this, and everything was over, in the new day's newspaper, Enron Company withdrew from the report that should have been the protagonist, and Arthur Andersen gloriously replaced the original report. The main character makes his grand entrance.

When Chen Fan heard the news, he was surprised for a while.

According to the news released by the media, Arthur Andersen previously stated that their audit negligence led to major audit mistakes, and they did not discover Enron's financial fraud in advance.

However, in today's newspaper, the media released the latest news. After the US Securities and Exchange Commission decided to investigate Enron, Arthur Andersen's Houston office, which was responsible for providing services to Enron, began to destroy documents related to Enron.

Such destruction activities continued for a long time until they received a subpoena from the US Securities and Exchange Commission. During this period, they have destroyed at least thousands of pages of documents.

The firepower of the media began to output at full strength, and the target was aimed at the former top five accounting firms in the world. Whether there are shadows of PricewaterhouseCoopers, KPMG, Ernst & Young, and Deloitte behind this, the outside world has not paid attention at this time, but they know the inside story However, Chen Fan has already affirmed that the former top five will soon become the top four.

Of course, there may be other small and medium-sized firms behind the push, and maybe they also want to fill this position.

At least, the information obtained from Zhang Quan clearly shows that many firms have begun to contact Andersen people to poach corners. At this precarious time, their competitors have raised their sharp butcher knives.

During the whole process, Chen Fan chose to stand still and continue to wait and see. Although it seemed that everything had come to an end, Chen Fan still believed that the big drama had not yet begun.

(End of this chapter)