Enron's Paper Customers Flee the Stumbling Giant
Moses, Lucia, Editor & Publisher
The company's newsprint contracts for financial and physical products mostly destined for the dustbins
As the Enron Corp.'s legal and financial problems mount, Everestlike, so has the number of newspaper companies that have canceled newsprint contracts with the collapsed energy and trading powerhouse. And questions continue to swirl around the future of its paper mills.
The Tribune Co. has said good riddance to its financial hedge contract with Enron, which cost Tribune an extra $5 million in the fourth quarter. The New York Times Co. has scrapped its financial hedge contract, exercising a clause that lets it do so in case of bankruptcy or other default. Media General Inc. canceled its hedge contract late last year. And the E.W. Scripps Co. has simply stopped getting newsprint shipments from Enron.
Other swap customers -- such as MediaNews Group Inc. and North Jersey Media Group Inc., parent of The Record in Hackensack, N.J. -- continue to abide by their contracts while evaluating their legal options. Knight Ridder, which hedges about 2% of its newsprint supply through Enron, would not comment on the status of its contract. …