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The Rise and Fall of Enron (1998 (Fastow was promoted to CFO, As Enron'…
The Rise and Fall of Enron
1990
Enron introduced a new division, Enron Finance Corp., that was headed by Skilling
Skilling hired Andrew Fastow who then became Skilling's protg
1985
Enron was born from the merger of Houston Natural Gas and InterNorth, a Nebraska pipeline company
A federal deregulation of natural gas pipelines deprived Enron of an exclusive right to the company which pushed them to seek for a new business strategy
Enron hired Jeffrey Skilling as a consultant who eventually proposed the concept of "Gas Banks"
1998
Fastow was promoted to CFO
As Enron's reputation grew, the company's internal culture began to take a darker tone
Skilling instituted a Professional Review Committee (PRC) which became known as the harshest employee ranking system in the country
PRC promoted a tight internal competition which resulted to having restrictive confidentiality clauses on trading contracts
1996
Skilling became Enron's Chief Operating Officer
Skilling then sold the concept of gas banks to the heads of power companies and to energy regulators as new investment opportunities were opening up everywhere, including markets in energy
1997
Enron acquired Portland General Electric Corporation, an electric utility company
Skilling developed Enron Capital and Trade Resources which eventually became the nation's largest wholesale buyer and seller of natural gas and electricity
1999
EOL was perhaps the most anticipated development of Enron because of mainly two reasons
traders received valuable information regarding the long and short parties to each trade as well as product prices in real-time
traders believed that Enron provided a safe transaction environment
Enron Online was created
2000
Enron built as high-speed broadband telecommunications network
The stock of Enron hit an all-time high of $90.56 and was named as one of the most admired and innovative companies in the world
Enron's competitive advantage began to erode with market's new entrants successes