Editing Enron (section)

===Post-merger rise (1985–1991)===
[[File:1400SmithDowntown.jpg|thumb|[[1400 Smith Street]], the former headquarters of Enron in Downtown Houston, Texas (now occupied by [[Chevron Corporation]])]]

The company was initially named '''HNG/InterNorth Inc.''', even though InterNorth was technically the parent.<ref name=":2" /> At the outset, Segnar was CEO but was soon fired by the board of directors to name Lay to the post. Lay moved its headquarters back to Houston and set out to find a new name, spending more than $100,000 in focus groups and consultants in the process. [[Lippincott & Margulies]], the advertising firm responsible for the InterNorth identity five years prior, suggested "Enteron". During a meeting with employees on February 14, 1986, Lay announced his interest in this name change, which would be held to a stockholder vote on April 10. Less than a month from this meeting, on March 7, 1986, a spokesman for HNG/InterNorth rescinded the planned Enteron proposal, as since its announcement the name had come under scrutiny for being the same as [[wikt:enteron|a medical term for the intestines]]. This same press release saw the introduction of the Enron name, which would be the new name voted on come April.<ref name=":0" /><ref name=":1" />

Enron still had some lingering problems left over from its merger, however, the company had to pay Jacobs, who was still a threat, over $350 million and reorganize the company.<ref name=":0" /> Lay sold off any parts of the company that he believed didn't belong in the long-term future of Enron. Lay consolidated all the gas pipeline efforts under the Enron Gas Pipeline Operating Company. In addition, it ramped up its electric power and natural gas efforts. In 1988 and 1989, the company added power plants and [[cogeneration]] units to its portfolio. In 1989, [[Jeffrey Skilling]], then a consultant at [[McKinsey & Company]], came up with the idea to link natural gas to consumers in more ways, effectively turning natural gas into a commodity. Enron adopted the idea and called it the "Gas Bank". The division's success prompted Skilling to join Enron as the head of the Gas Bank in 1991.<ref name=":2" /> Another major development inside Enron was a pivot to overseas operations with a $56 million loan in 1989 from the [[Overseas Private Investment Corporation]] (OPIC) for a power plant in Argentina.

====Timeline (1985–1992)====
=====1980s=====
* New regulations gradually create a market-pricing system for natural gas. [[Federal Energy Regulatory Commission]] (FERC) Order 436 (1985) provides blanket approval for pipelines that choose to become common carriers transporting gas intrastate. FERC Order 451 (1986) deregulates the wellhead, and [[FERC Order 490]] (April 1988) authorizes producers, pipelines, and others to terminate gas sales or purchases without seeking prior FERC approval. As a result of these orders, more than 75% of gas sales are conducted through the spot market, and unprecedented market volatility exists.<ref name="fusaro" />

======July 1985======
* [[Houston]] Natural Gas, run by [[Kenneth Lay]] merges with InterNorth, a natural gas company in [[Omaha]], Nebraska, to form an interstate and intrastate natural gas pipeline with approximately {{Convert|37000|mi|abbr=on}} of pipeline.<ref name="fusaro">Fusaro, Peter C, ''What went wrong with Enron''. J Wiley & Sons 2002</ref>

======November 1985======
* Lay is appointed chairman and chief executive of the combined company. The company chooses the name Enron.<ref name="loren" />

=====1986=====
* Company moves headquarters to Houston, where Ken Lay lives. Enron is both a natural gas and oil company.
* ''Enron's vision:'' To become the premier natural gas pipeline in America.<ref name="mimi">Mimi Swartz, Sherron Watkins, ''Power Failure: The Inside Story of the Collapse of Enron'' (Doubleday, 2003) {{ISBN|0-385-50787-9}}.</ref>

=====1987=====
* Enron Oil, Enron's petroleum marketing operation, reports a loss of $85 million in 8-K filings. True loss of $142–190 million is concealed until 1993. Two top Enron Oil executives in [[Valhalla, New York]], plead guilty to charges of fraud and filing false tax returns. One serves time in prison.<ref name="fusaro" />

=====1988=====
* The company's major strategy shift – to pursue unregulated markets in addition to its regulated pipeline business – is decided in a gathering that became known as the ''Come to Jesus'' meeting.<ref name="loren">Loren Fox, ''Enron: The Rise and Fall''. (Hoboken, N.J.: Wiley, 2003).</ref>
* Enron enters the UK energy market following the privatization of the electricity industry there. It becomes the first U.S. company to construct a power plant, [[Teesside Power Station]], in Great Britain.<ref name="fusaro" />

=====1989=====
* Enron launches ''Gas Bank'', later run by [[CEO]] [[Jeffrey Skilling|Jeff Skilling]] in 1990, which allows gas producers and wholesale buyers to purchase gas supplies and [[Hedge (finance)|hedge]] the price risk at the same time.<ref name="loren" />
* Enron begins offering financing to oil and gas producers.<ref name="fusaro" />
* [[Transwestern Pipeline|Transwestern Pipeline Company]], owned by Enron at that time, is the first merchant pipeline in the US to stop selling gas and become a transportation-only pipeline.<ref name="fusaro" />

=====1990=====
* Enron launches plan to expand US natural gas business abroad.<ref name="fusaro" />
* Enron becomes a natural gas market maker. Begins trading [[futures contract|futures]] and [[option (finance)|option]]s on the [[New York Mercantile Exchange]] and over-the-counter market using financial instruments such as [[swap (finance)|swap]]s and [[option (finance)|option]]s.<ref name="fusaro" />
* Ken Lay and Rich Kinder hire Jeff Skilling from [[McKinsey & Company]] to become CEO of ''Enron Gas Services'', Enron's "Gas Bank". Enron Gas Services eventually morphs into ''Enron Capital and Trade Resources'' (ECT).<ref name="fusaro" />
* Jeff Skilling hires [[Andrew Fastow]] from the banking industry; he starts as account director and quickly rises within the ranks of ECT.<ref name="fusaro" />

=====1991=====
* Enron adopts [[mark-to-market accounting]] practices, reporting income and value of assets at their replacement cost.<ref name="fusaro" />
* [[Rebecca Mark]] becomes chairman and CEO of Enron Development Corp., a unit formed to pursue international markets.<ref name="mimi" />
* Andy Fastow forms the first of many off-balance-sheet partnerships for legitimate purposes. Later, off-balance-sheet partnerships and transactions will become a way for money-losing ventures to be concealed and income reporting to be accelerated.<ref name="fusaro" />{{efn| In September 1999, Fastow pitched a partnership between Enron and [[Merrill Lynch]] to provide $390 million in outside investments for the Fastow controlled private partnership known as the [[LJM (company)|LJM2 Co-Investment LP]].<ref>{{cite news |last=Johnson |first=Carrie |url=https://www.washingtonpost.com/archive/business/2002/07/31/enron-pact-troubled-merrill-employee/1e723c71-f746-46a8-a95c-9d4faaf1ac95/ |title=Enron Pact Troubled Merrill Employee |newspaper=[[Washington Post]] |date=July 31, 2001 |access-date=August 9, 2023 |archive-date=August 9, 2023 |archive-url=https://archive.today/20230809202316/https://www.washingtonpost.com/archive/business/2002/07/31/enron-pact-troubled-merrill-employee/1e723c71-f746-46a8-a95c-9d4faaf1ac95/}}</ref> The then Enron Treasurer Jeff McMahon would book a $12 million gain and meet its earnings target for 1999 with a $7 million investment from Merrill Lynch for a stake in three floating power generators off Nigeria. In July 2000, Merrill Lynch sold its stake in three floating power generators off Nigeria to the Fastow-controlled LJM2 to place the venture off the books.<ref>{{cite news |last=Ivanovich |first=David |url=https://www.chron.com/business/enron/article/early-on-exec-saw-enron-deal-as-risk-2063208.php |title=Early on, exec saw Enron deal as risk |work=[[Houston Chronicle]] |date=July 31, 2002 |access-date=August 9, 2023 |archive-date=August 9, 2023 |archive-url=https://archive.today/20230809202208/https://www.chron.com/business/enron/article/early-on-exec-saw-enron-deal-as-risk-2063208.php}}</ref> In August 2001, [[Sherron Watkins]] informed [[Ken Lay]] that the Fastow partnerships could cause Enron to "implode in a wave of accounting scandals." Lay requested that Watkins and Elizabeth A. Tilney, whose investment banker husband Schuyler Tilney is a managing director and head of the energy investment banking unit at Merill Lynch and a close personal friend of Andrew S. Fastow and his wife [[Lea Fastow|Lea]], develop a crisis management strategy.<ref name=NYT31072002>{{cite news |last=Barboza |first=David |url=https://www.nytimes.com/2002/07/31/business/corporate-conduct-close-links-merrill-banker-had-many-direct-ties-to-enron.html |title=CORPORATE CONDUCT: CLOSE LINKS; Merrill Banker Had Many Direct Ties to Enron |work=[[New York Times]] |date=July 31, 2002 |access-date=August 9, 2023 |archive-date=August 9, 2023 |archive-url=https://archive.today/20230809203009/https://www.nytimes.com/2002/07/31/business/corporate-conduct-close-links-merrill-banker-had-many-direct-ties-to-enron.html}}</ref> In 1993, Schuyler Tilney joined Merrill Lynch and previously he had been employed at [[Credit Suisse First Boston|CS First Boston]] during which CS First Boston invested heavily in the [[Boris Jordan|privatization of Russia]].<ref name=NYT31072002/><ref name=Bloomberg1995>{{cite news |last=Kranz |first=Patricia |url=https://www.bloomberg.com/news/articles/1995-05-21/boris-jordan-the-man-who-made-moscows-market |title=Boris Jordan: The man who made Moscow's Market |work=[[Businessweek]] |date=May 22, 1995 |access-date=August 9, 2023 |archive-date=June 6, 2021 |archive-url=https://archive.today/20210606010753/https://www.bloomberg.com/news/articles/1995-05-21/boris-jordan-the-man-who-made-moscows-market}}</ref><ref>{{cite news |last=Апраксин |first=Григорий (Apraksin, Grigory) |url=http://www.flb.ru/iw0023.html |title=Тихий американец или 5 российских скандалов из жизни Бориса Йордана |trans-title=The Quiet American or 5 Russian scandals from the life of Boris Jordan |language=ru |work=[[:ru:Агентство федеральных расследований|Free Lance Bureau]] (flb.ru) |date=December 29, 1999 |access-date=August 9, 2023 |archive-date=November 22, 2001 |archive-url=https://web.archive.org/web/20011122044058/http://www.flb.ru/iw0023.html}}</ref>}}

=====1992=====
* Enron acquires [[Transportadora de Gas del Sur]].<ref name="fusaro" />