MG plc ,
 FYI
----- Forwarded by Mark E Haedicke/HOU/ECT on 06/26/2000 05:16 PM -----

	Travis McCullough
	06/23/2000 06:03 PM
		 
		 To: shodgson@velaw.com
		 cc: Mark E Haedicke/HOU/ECT@ECT
		 Subject: MG plc

Steve:

Attached is a series of press releases by MG Plc regarding their metals 
website, the first of which was launched on or about October 4, 1999.

I also have a message in to the attorneys at Enron that worked closely on the 
acquisition, but one of our commercial people understands the site to be an 
on-line brokerage system (like E*Trade) -- the press release on the launch of 
the system (at the bottom of this message) indicates that the site is an LME 
trading and execution system.  I'll forward over any other information I can 
find.     




USA: Metal exchanges hold firm as Web trading blooms.

06/22/2000
Reuters English News Service 
(C) Reuters Limited 2000. 

NEW YORK, June 22 (Reuters) - The world's two largest metal exchanges said 
they will retain their roles despite the rapid expansion in Internet trading 
and as another major metal dealer announced the launch of an online trading 
system on Thursday. 
The London Metal Exchange (LME) is carefully planning its introduction of 
electronic trading in the second-half of this year and refuses to be 
"spooked" by those "urging action, any action, as long as it is now," 
Jonathan Haslam, LME director of corporate affairs, told a conference in New 
York.
His comments were echoed by Patrick Thompson, president of the New York 
Mercantile Exchange (NYMEX), who said it would be very difficult for the new 
online trading systems to bring together those elements that underpinned the 
success of the traditional exchanges. 
Thompson told the Metal Bulletin E-Commerce 2000 conference that said these 
elements included the handling of counterparty credit risk, the clearing of 
trades and the existing pools of liquidity provided by the different segments 
of the metals market which use the exchanges. 
Haslam compared the LME's trading turnover averaging $8 billion a day with 
the around $1.5 billion a day traded online by U.S. energy giant Enron Corp. 
. 
Enron's expansion in the e-commerce market was earlier referred to by Thomas 
Pimpinelli, senior vice president of MG London Inc. part of U.K.-based metals 
trading group MG Plc . In May, MG agreed to a 300 pence per share cash offer 
from Enron. 
Pimpinelli said MG's own MITS online metals trading system, launched in 
October 1999, has to date processed over 135,000 contracts with an overall 
value of $5.25 billion. 
He told the meeting that between 65 percent to 80 percent of MG's order flow, 
mostly from small metals clients, was now done over the Internet. 
Pimpinelli said the success of its "Market Maker" real-time trading facility 
within MITS for tonnages of up to a 1,000 tonnes, had encouraged the company 
to create a new product for the Managed Futures industry called "CTA Trader." 
The product will differ from Market Maker in that the customer can trade 
larger volumes, request a volume quote on-line, and then have the facility to 
book the resulting live on-line quote. 
"Once executed the customers will need to breakdown or allocate the 
transaction to his individual or multiple pre-approved clearing houses by way 
of a dropdown menu," he said. Pimpinelli added that CTA Trader would be 
launched in the next month or so. 
Sharing a platform with Pimpinelli, Karl Hackert, head of e-commerce at U.S. 
trader Koch Metals, announced the impending launch of his company's own 
online metals trading system by the end of June. Koch metals is a unit of 
Koch Industries Inc. . 
Hackert said the issue of the LME's daily forward prices valuation at 5.30 
p.m. in London, meant that the level of these quotes wasn't clear during the 
rest of the trading day. Under the new Koch system prices will be updated 
every five seconds and out to 27 months. 
"Koch are the first to do this (offer near real-time forward prices) and it 
is a big step forward in terms of market transparency," he said. 
Hackert said Koch had built its system to better communicate with its clients 
and it did not intend to go into direct competition with the LME. 
"Making a generic mass system? I don't think that's the business we're in," 
he said. 
((Steve Hays, New York Commodity desk, 212 8591640)).


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UK: UPDATE 2-MG to widen access to online metals trade.
By Andy Blamey

06/13/2000
Reuters English News Service 
(C) Reuters Limited 2000. 

LONDON, June 13 (Reuters) - U.K.-based metals trading group MG plc said on 
Tuesday it would broaden access to its online metals trading systems as the 
battle for web pre-eminence comes to the boil. 
MG, one of the world's leading metals traders, said it would allow London 
Metal Exchance clearing members to use the system, which had been restricted 
to clients, with immediate effect.
The move comes in response to strong demand for access to the system, an MG 
spokesman said. MG has so far signed up 14 Category One (ring dealing) and 
Category Two (associate broker clearing) members of the LME. 
"We have decided to broaden the availability of Market Maker following the 
rapid increase in volumes and substantial uptake by both existing and new 
clients," said Michael Hutchinson, CEO of MG's Financial Services Division in 
a statement. 
"We are confident that we have an online product which will meet demand from 
other clearing members of the LME." 
The wider access to MG's system need not necessarily pose a threat to other 
online marketplaces, said Gavin Gross, head of LME metals at brokerage 
Spectron Futures Ltd. Spectron plans to launch online systems to trade London 
Metal Exchange contracts later this month. 
"They're very different models. MG is a principal in the market, so you're 
looking at MG prices only. Spectron is neutral, we're just providing a 
platform. It's a multilateral system with lots of dealers interacting with 
each other," Gross said. 
"The two can exist side by side," he added. 
Over 80 percent of MG's clients are now using its online services, the 
company said. Market Maker turnover stood at 3,000 contracts in May - a 
growth rate of approximately 50 percent per month since the launch in January 
of this year. 
Online deals still make up a low proportion of MG's total trading turnover, 
however. 
MG's MITS system launched in October 1999 and has now processed over 95,000 
contracts with a dollar value in excess of $3.8 billion and a monthly 
turnover in excess of $1 billion. 
"We are using it (MITS) for the one or two lot small stop orders that you 
previously missed and had the customer ringing up asking if we had done his 
trade," said one user of an MG system at an ABCM. 
However, it would appear that MG is now limiting the size of the orders it 
will accept on MITS from its non-customers, he said. 
Metals e-commerce sites are proliferating, but they follow no single business 
model. There are portals run by single principals quoting their own prices; 
intranets where big market players are cooperating; different rules for 
access; and a wide variation in revenue models, the key to profitability. 
The company announced in March it had joined Internet Capital Group and 
Safeguard International Fund to form the EMETRA joint venture, in which MG 
has a 25 percent stake. 
EMETRA is building a worldwide business-to-business (B2B) e-commerce 
marketplace for the non-ferrous metals markets, including physical trading a 
futures and options contracts. 
MG contributed its Internet systems to EMETRA and continues to use MITS and 
Market Maker under a licence agreement with EMETRA. 
In May, MG agreed a 300 pence per share cash offer from U.S. energy and 
communications group Enron, a major player in the e-commerce market through 
Enron Online, which trades around 840 products in some 13 countries in 11 
currencies.


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US Enron Bid For MG May Signal End Of LME Outcry Trading
By Adam Aljewicz

05/23/2000
Dow Jones International News 
(Copyright (c) 2000, Dow Jones & Company, Inc.) 

LONDON -(Dow Jones)- Enron's (ENE) offer to buy London Metal Exchange ring 
dealing firm MG PLC (U.MGA) could bring the exchange one step closer to 
ending open outcry trading, dealers say. 
Both the U.S.-based energy and communications group, and MG have pioneered 
electronic trading and are widely seen as being among the only participants 
on the LME trading floor capable of making the transition to on-screen 
trading. The LME, meanwhile, is also seeking to introduce on-screen 
technology for out-of-ring trading sessions.
"We're not surprised in the least to see this tie-up take place," an analyst 
at Deutsche Bank told Dow Jones Newswires. "Everything we see now is pointing 
toward the removal of the ring-dealing sessions, and it's just a matter of 
time before it ends all together," she said. 
MG's chairman Tom McKeever said the company won't abandon its position as an 
LME ring dealing member, but market watchers doubt whether - after 123 years 
- open outcry can survive on the LME as fast-paced technological change 
sweeps through the industry. 
Enron has made a GBP300 million cash offer for London-based MG in a bid to 
gain a foothold in the $120 billion-a-year world metal market. The U.S. 
company already has a substantial market share in natural gas and electricity 
markets, and with its electronic trading platform, Enron On Line, it has 
already executed more than 110,000 transactions valued at over $45 billion 
since its launch in November. 
"It's not surprising to see a strategic link up between an energy and metals 
company because they're both very big in industrial commodities," said an 
analyst for a U.S.-based commission house. "I think it's almost inevitable 
that open outcry trading will be a thing of the past," he said. 
Enron's move into the metals market has also been linked to the LME's growing 
interest in initiating an automated trading system, and has lead some market 
watchers to suggest that the Enron-MG tie-up will lead to greater 
consolidation among LME members. 
Metals trading companies and brokerage firms are struggling to survive as 
profits wane amid the growth of banks and funds in the metals trading arena. 
"Out of the 13 ring dealing firms on the LME, I think only six will be able 
to make the transition to on-screen trading," said a dealer for a 
London-based bank. "And that's only because we have a banking background," he 
said. 
The six cited are MG, the metals trading arm of the Bank of Nova Scotia, 
U.S.-based brokerage Refco Inc., Credit Lyonnais Rouse, Barclays Capital and 
Fimat Metals. 
The LME's existing system involves the trading of eight metals within its 
circular trading floor. Around 35% of the LME's trading takes place there, 
but this figure could drop if the LME decides to abandon open outcry, traders 
say. "Market participants will have to decide whether to use the ring 
or go through the Internet," said a dealer. "That's how it will start
and will probably lead to the trading floor being bypassed
altogether." 

MG, which was spun off from Germany's Metallgesellschaft last September, has 
pioneered the use of metals trading on the Internet with the launch in 
October of MITS and MARKET MAKER, its Internet trading system. 
MG is the second-largest physical merchant of copper, nickel and aluminum in 
Europe after Switzerland's Glencore. 
"When profit margins are narrowing and so many LME companies are looking more 
and more uncertain about their future, MG (is) arguably the pick of the crop 
in terms of stability and profitably," said a dealer for a North 
American-owned ring dealing firm. LME Considers Screen Trading 

Separately, the LME has considered a series of moves that would also hasten 
the demise of open outcry trading. 
It has repeatedly said it is looking to develop an electronic screen-trading 
system for use in out of ring trading sessions, and that it plans to press 
ahead with changes to its ownership structure by demutualizing in favor of 
becoming a shareholder entity. 
"We've made very clear that there are proposals for consequential changes to 
the LME's governance," said Jonathan Haslam, director of corporate affairs at 
the LME. 
The LME set up an eight-member committee in February which comprised four 
ring dealing members and four associate broker members to map out a strategy 
for the implementation of new technology. 
However, it has so far declined to comment on how this technology will be 
executed, although Haslam has said the LME is looking at around 20 companies 
with the requisite knowledge and background to provide and implement the 
on-screen technology. 
"We said we would look into setting up an interoffice screen trading system 
but we have yet to come to a decision on who our technical partner will be," 
he said. "But we should come to a decision in a couple of weeks." 
-By Adam Aljewicz; 44-20-7842-9353; adam.aljewicz@dowjones.com -0- 23/05/00 
12-56G


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Financial Post
MG exceeds $1B Internet trade target
Martin Hayes
Reuters

04/05/2000
National Post 
National 
!@SERIES=
C14
(c) Copyright 2000 Financial Post from National Post (formerly The Financial 
Post Company). All rights reserved. 

LONDON - International metals trader MG PLC said yesterday that business on 
its six-month old Internet trading systems had comfortably exceeded its 
transaction value target of $1-billion (all figures in U.S. dollars). 
"We are at $1.5-billion as of this morning. We are are very pleased with the 
progress and the rate of growth," said Tom McKeever, MG chairman.
He noted that online trading in metals is seen growing rapidly, according to 
a recent study by Anderson Consulting. Just 2% to 3% of business in the 
non-ferrous industry is currently conducted online, while in three to five 
years it will be 40% to 60%, he said. 
Since the launch in October, volumes on MG's internet systems, known as MITS 
and MARKET MAKER, have increased by 50% a month and cumulatively exceed 
30,000 contracts now. 
MG said it had also gained customers as its systems are the only ones that 
currently offer online trading. "When we launched the system, we had requests 
from many new customers to register. We registered quite a few new customers. 
It is beyond our expectations," Mr. McKeever added. 
The increase in on-line business on MITS has been seen round the clock as 
customers have become increasingly comfortable with the system. 
"We were the first to start the system. It has been late coming to the metals 
business, but we think it is good for the industry," he said. 
Last month, MG announced it had joined Internet Capital Group and Safeguard 
International Fund to form an eMetra joint venture in which it has a 25% 
stake.


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MG PLC - Trading Update

04/04/2000
Regulatory News Service 
Copyright (C) 2000 Regulatory News Service; Source: World Reporter (TM) 

MG INTERNET TRADING UPDATE 
MG announces that in the first six months of trading on its Internet systems, 
MITS and MARKET MAKER, it has surpassed its target of US $1 billion in value 
of transactions. The volume of transactions has been increasing by 50% a 
month since October and cumulatively exceeds 30,000 contracts.
The trading systems have attracted new customers as well as MG's existing 
customers because it is the only system currently available that offers them 
an on-line LME trading and execution service. 
The launch of MITS was announced in October 1999 by MG. In February, MG 
announced that it had joined with Internet Capital Group and Safeguard 
International Fund to form the eMetra joint venture, in which MG has a 25% 
stake. eMetra is in the process of establishing a worldwide 
business-to-business (B2B) e-commerce marketplace for the non-ferrous metals 
markets, including physical trading and the trading of futures and options 
contracts. MG contributed its Internet systems to eMetra and continues to use 
MITS and MARKET MAKER under a licence agreement with eMetra. Once eMetra is 
fully operational later this year, MG will become a user of eMetra's 
platform. 
Michael Hutchinson, Joint Chief Executive of MG plc, said: "We are delighted 
that so many customers to date have transferred their business on to the 
Internet - we see this trend as increasing significantly in the coming 
months. It is proving attractive to new customers and enables us to give our 
existing customers a more efficient service." 
For further information: 
Michael Hutchinson, Joint Chief Executive MG plc Tel: 0171 488 2244 
Nick Denton/James Longfield Hogarth Partnership Tel: 0171 357 9477


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City: MG plans to launch metals website
James Ashton

02/11/2000
The Daily Telegraph 
Copyright (C) 2000 The Daily Telegraph; Source: World Reporter (TM) 

MG, the international metals trader, yesterday unveiled plans to develop an 
internet marketplace for trading non-ferrous metals, in direct competition 
with the London Metals Exchange (LME). 
The joint venture with the Internet Capital Group (ICG) and private equity 
fund Safeguard International will establish a worldwide business-to-business 
e-commerce platform for non-ferrous metals. This will include physical 
trading and the trading of options and futures contracts.
MG shares soared 140 1/2 to 337 1/2 p. 
"We didn't go into this venture intending to put anyone out of business," 
said chairman Thomas McKeever. 
He added that the as-yet-unnamed new venture would attract new clients, 
particularly small and medium-sized companies who regard conventional LME 
trade as too costly and complex. 
He said he also hoped to open up the derivatives market to smaller players. 
"When you develop a global marketplace you attract, presumably, most industry 
participants," he added. 
Safeguard and Nasdaq-listed ICG, which already has stakes in more than 50 
companies offering online trading in sectors such as industrial chemicals, 
plastics and cattle, have invested a total of $25 million in the venture, 
taking 30 and 45pc stakes respectively. 
MG, the world's largest copper merchant, will hold an initial 25pc, with an 
option to increase that to 50pc within eight months. The company, which 
floated last September at 205p, after being spun off from German engineering 
group Metallgesellschaft, will continue to operate its internet trading 
system Mits for existing customers. It began live internet dealing of 
aluminium and copper in January.


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MG expects MITS to be a hit.
CHRISTIAN KOHL

10/14/1999
American Metal Market 
8
Copyright 1999 Information Access Company. All rights reserved. COPYRIGHT 
1999 Cahners Publishing Company 

DUSSELDORF -- Only one week after London Metal Exchange trader 
Metallgesellschaft Ltd. launched its web site system that allows trade 
execution services on the Internet, it is optimistic that the concept will be 
a hit. 
"It's been quite extraordinary," said Alex Health, MG's director of 
e-commerce systems. "We've had something like 300 reactions so far from both 
existing customer companies as well as new ones logging on." He said that the 
non-customers entering MG'S site (www.mgltd.co.uk) ranged from large groups 
MG had wanted to make contact with for a longtime to small companies that 
Heath said he'd never heard of. 

"Of course, it's LME Week now, so we are busy with socializing and making 
contacts there before we can reply to the requests we've received," Heath 
said. He noted that LME Week was one important factor in launching the 
Metallgesellschaft Internet Trading System (MITS) in time to display it at 
Broker's House by Tuesday evening. MG Plc's recent floatation also provided a 
major motivation for the project to raise MG's profile, he said: 
Heath said that MITS has not had an immediate effect on trading volumes 
beyond the regular market, activity, but 70. customers so far had used the 
facility for deals. He added that MITS might soon contribute to MG's customer 
base, but it would take some time for new parties attracted to the site to be 
registered as regular customers. 
At the beginning of LME Week, few LME trading companies were prepared to 
comment on MITS and its possible effect on metals trading. MG's presentations 
at the LME event were aimed at providing a clearer picture. "I'd be extremely 
disappointed if the idea didn't spread as the Internet will inevitably be a 
big factor in trading," Heath said. He noted that MG put itself under 
pressure by moving before some other company with a similar 
project-in-the-making could enter the scene. 
"Speed is a definite factor in the Internet, and we can claim to be leading 
into the new millennium in this regard," he said, adding that MG received 
many "flattering comments" from brokers. 
Peter Sellars of Barclays Bank Plc conceded that "certainly they got there 
before anybody else" but added that "they won't have very much of a lead 
time." He said that the Internet was going to be the way of the future and 
that Barclays was making similar preparations, but so far offered a web site 
order trading system only for non-metallic futures. He noted, however, that 
web site trading would not satisfy all requirements. "It's great for the 
small bread-and-butter stuff, but for long-term contracts it's gonna be 
tricky, isn't it," Sellars said. 
A spokesman at Triland Metals Ltd., another LME member, questioned whether MG 
was really embracing technology or vice versa. "It could be a gimmick for 
customers, and it doesn't really mean they're successful with enlarging their 
customer base," he said. He noted that people were always interested in 
coming close but weren't necessarily keen on taking the final step. He said 
that Triland had no immediate plans for a similar service and that it was 
confining its web site plans to statistics and other basic information. "They 
jumped the gun to a certain extent, but we'll have to see if it's successful 
or not."


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European & Emerging Markets
MG Launches First Internet Metals Trade Service
A Wall Street Journal Europe Roundup

10/05/1999
The Wall Street Journal Europe 
16
(Copyright (c) 1999, Dow Jones & Company, Inc.) 

LONDON -- MG PLC has launched the first Internet-based metals futures trading 
system. 
MG, which went public on the London Stock Exchange in September, offers a 
full trading and execution service on the London Metals Exchange.
The system, which is called MITS, will be supported by a real-time price 
screen for all the metals traded on the LME and includes a multi-currency 
facility. The LME trades copper, aluminium, lead, zinc, nickel, tin, silver 
and aluminium alloy. 
In addition, customers can listen to a direct voice commentary from the floor 
of the LME during trading sessions. 
Technical analysis and market research on all LME metals is available and 
regularly updated. Customers can also access their position and valuation 
statements over a secure encrypted link to the firm's computer system. 
MITS can only be accessed by registered customers of Metallgesellsc haft 
Limited, MG's LME brokerage and trading arm. 
"It is a customer service and it is live now to our registered customers," 
said Michael Hutchinson, MG's joint chief executive. 
MG's customers will also be able to listen to a direct-voice commentary from 
the floor of the LME during trading sessions. They will also be able to 
access their position and valuation statements over a secure encrypted link 
to MG's computer system, MG said. 
The LME is the world's largest non-ferrous metals market with 14 ring-dealing 
members who participate in the twice-daily important open-outcry sessions. 
The LME settlement prices for metals which are realized in the official 
morning trading sessions are the benchmark reference prices for most of the 
world's physical contracts. 
Outside the open-outcry sessions, LME business takes place over a 24-hour 
period via an inter-office telephone market. 
"We are always interested in any new uses of technology. We will watch this 
with interest," an LME spokeswoman said. 
MG said it intended to develop its website to eventually include real-time 
physical metal prices and premiums. 
MG's system is the latest in a series of Internet commodity trading systems.


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MG PLC - Re Internet Trading System

10/04/1999
Regulatory News Service 
Copyright (C) 1999 Regulatory News Service; Source: World Reporter (TM) 

Introduction of the first Internet LME trading system 
MG plc, the international metals trading business which floated on the London 
Stock Exchange in September 1999, today announces the launch of the world's 
first Internet based metals futures trading system, offering a full LME 
trading and execution service. The new site can be accessed at 
www.mgltd.co.uk and is designed to make dealing more efficient and more 
readily accessible to customers of Metallgesellschaft Limited, MG plc's LME 
brokerage and trading arm.
The system, which is called MITS, will be supported by a real time price 
screen for all the metals traded on the LME and includes a multi-currency 
facility. In addition customers can listen to a direct voice commentary from 
the floor of the LME during trading sessions. Technical analysis and market 
research on all LME metals is available and regularly updated. Customers can 
also access their position and valuation statements over a secure encrypted 
link to the firm's computer system. 
MITS can only be accessed by registered customers of Metallgesellschaft 
Limited. Prospective customers can view a demonstration programme at the 
website. The system will complement the company's traditional brokerage 
activities. 
Michael Hutchinson, Joint Chief Executive of MG plc, said today: 
"The development of MITS will make our business more efficient and make 
dealing for customers more accessible and cost-effective. Being the first LME 
broker to provide a comprehensive E-commerce system should further improve 
our competitive advantage, enabling us to reach all of our brokerage 
customers with timely and accurate information." 
MG plc intends to develop a site for its merchanting business, providing 
real-time physical metal prices, premiums and other related information. 
For further information: 
Michael Hutchinson, Joint Chief Executive MG plc Tel: 0171 488 2244 
Nick Denton/James Longfield Hogarth Partnership Tel: 0171 357 9477 
Background on MG plc 
MG plc is a leading independent international metals trading business 
providing services to the global metals industry. The group is organised into 
two operating divisions: Merchanting and Financial Services. The Merchanting 
division is buys, sells, stores, ships and trades non-ferrous metals as a 
principal with producers and consumers. It is the world's leading copper 
merchant, one of the top three merchants of copper concentrates and nickel 
and a leading European merchant of recycled metal. The Financial Services 
division is a leading metals broker and market-maker. It is a leading LME 
member and operates one of the leading LME metals warehousing businesses. MG 
is headquartered in London, and employs 320 people in 14 countries around the 
world. It was listed on the London Stock Exchange in September 1999 and has a 
current market capitalisation of some #175 million.


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Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. 


Travis McCullough
Enron North America Corp.
1400 Smith Street EB 3817
Houston Texas 77002
Phone:  (713) 853-1575
Fax: (713) 646-3490
michael.brown@enron.com, justin.boyd@enron.com