Time Warner Telecom buys Enron fiber

Time Warner Telecom purchased about 50 miles of fiber in the Portland, Ore., area from bankrupt Enron subsidiary Enron Broadband on Friday.

TWT will pay about $750,000 in cash for the fiber, which rings the Oregon cities of Portland, Beaverton, Hillsboro and Tigard, the company said. Though TWT already serves the Portland area with voice and data services, the acquired fiber will give it access to areas it didn’t have before, including 40 additional buildings in the Lloyd Center and Eastside business districts.

TWT previously leased some of the fiber from Enron Broadband as well, so the purchase will save TWT an undisclosed amount in maintenance costs, a TWT spokesman added.

When asked about the assets’ price tag, the spokesperson cited local reports that former Enron Broadband executives estimated the original construction cost of the network at $3 million to $5 million.

The auction was held Jan. 14 in a New York City bankruptcy court. Metropolitan Fiber Systems of Oregon, a subsidiary of MCI, started the bidding earlier in the month with a $300,000 offer.

Enron obtained the assets in the late 1990s when it had lofty ambitions to make a name for itself in telecom. In 1997, it acquired Portland General Electric and subsequently used its subsidiary, FirstPoint Communications, to accelerate the deployment of fiber networks in the area. Those ambitions were cut short when Enron collapsed under a wave of accounting scandals in 2001, implicating Enron Broadband in the process.

Seven former Enron Broadband executives are currently scheduled to go to trial starting in October to defend themselves against charges ranging from conspiracy and insider trading to fraud and money laundering.