Enron agrees to $29.5 million MegaClaims settlement with Merrill Lynch

By Caroline Salls

Pittsburgh, July 6 - Enron Corp. has reached a settlement agreement with Merrill Lynch & Co., Inc. under which Merrill Lynch will pay Enron $29.5 million in connection with Enron's MegaClaims litigation, according to an Enron news release.

Also under the settlement, $73.7 million in claims against the Enron estate will be subordinated and receive no distribution, and about $10 million in transferred claims will be allowed.

According to the release, the settlement reflects the fact that Merrill Lynch was involved in fewer transactions with Enron than some other MegaClaim defendants.

"This settlement is a further proactive step in our efforts to settle the Enron estate," president and board chairman John J. Ray III said in the release.

"We are gratified with the progress we have made to bring the MegaClaims litigation with Merrill Lynch to a close and remain optimistic that the remaining financial institutions will put their Enron issues to rest."

Remaining MegaClaim cases include Citigroup Inc., Deutsche Bank AG, Barclays plc and Fleet National Bank.

The settlement is subject to the execution of a definitive agreement and the approval of the U.S. Bankruptcy Court for the Southern District of New York.

Enron is a Houston-based energy company that emerged from bankruptcy on Nov. 18, 2004.

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