IP: Enron's cows

[David Farber <dave@farber.net>]

> From: Kobrin <KobrinS@wharton.upenn.edu>
> To: "Dave Farber (E-mail)" <farber@cis.upenn.edu>
>
> Dave,
>
> This has been circulating among Enron employees:
>
> Capitalism
>     You have two cows.
>     You sell one and buy a bull.
>     Your herd multiplies, and the economy grows.
>     You sell them and retire on the income
>
> Enron Venture Capitalism
> You have two cows.
> You sell three of them to your publicly listed company, using
> Letters of credit opened by your brother-in-law at the bank, then
> Execute a debt/ equity swap with an associated general offer so that you get
> all four cows back, with a tax exemption for five cows. The milk rights of
> the six cows are transferred via an intermediary to a Cayman Island company
> secretly owned by the majority shareholder who sells the rights to all seven
> cows back to your listed company. The Annual report says the company owns
> eight cows, with an option on one
> more. - No Balance Sheet provided with the release.
>
> Steve

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