================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED) - NOVEMBER 19, 2002
TXU EUROPE LIMITED
(Exact name of registrant as specified in its charter)
ENGLAND AND WALES 001-15709 98-0188080
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
THE ADELPHI, 1-11 JOHN ADAM STREET, LONDON, ENGLAND WC2N 6HT
(Address of principal executive offices, including zip code)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: 011-44-207-879-8081
================================================================================
ITEM 5. OTHER EVENTS AND REGULATION FD DISCLOSURE
TXU Europe Limited (TXU Europe) is a private limited company incorporated
under the laws of England and Wales on February 5, 1998. TXU Europe is an
indirect wholly-owned subsidiary of TXU Corp., a Texas corporation. TXU Europe
is a holding company for TXU Corp.'s United Kingdom (UK) and other European
operations.
TXU EUROPE AND CERTAIN SUBSIDIARIES PLACED UNDER ADMINISTRATION
On November 19, 2002, TXU Europe and several of its subsidiaries were
placed under the "administration" process in the UK (described below) by order
of the High Court of Justice, Chancery Division, Companies in England and Wales
(Court). Pursuant to the administration order, (i) Jim Tucker and Phil Wallace,
partners in KPMG LLP, were appointed administrators with respect to TXU Europe
and two of its indirect subsidiaries, TXU Acquisitions Limited and The Energy
Group Ltd.; (ii) Roy Bailey, Alan Bloom and Gareth Hughes, partners in Ernst &
Young LLP, were appointed administrators with respect to TXU UK Ltd. and TXU
Europe Energy Trading Limited, both also indirect subsidiaries of TXU Europe;
and (iii) Jim Tucker, Phil Wallace, Roy Bailey, Alan Bloom and Gareth Hughes
were appointed joint administrators with respect to TXU Europe Group plc, an
indirect subsidiary of TXU Europe and a indirect holding company for TXU UK Ltd.
and TXU Europe Energy Trading Limited.
TXU Corp. has announced that it has no intention to continue to fund the
operations or any obligations of TXU Europe or its subsidiaries and that it
anticipates writing off its entire investment in TXU Europe in the fourth
quarter of 2002.
ADMINISTRATION IN THE UK
In the UK, administration is the process by which a petition is made to the
court when it is believed that a company is, or is likely to become, unable to
pay its debts as they fall due and there is a real prospect that an
administration order, if granted, is likely to achieve one or more of the
following:
a) the survival of the company, and the whole or any part of its
undertaking, as a going concern;
b) the approval of a voluntary arrangement under Part 1 (of the
Insolvency Act 1986);
c) the sanctioning under section 425 of the Companies Act 1985 of a
compromise or arrangement between the company and such persons as are
mentioned in that section; and
d) a more advantageous realization of the company's assets than would be
effected on a winding up.
Purposes b), c) and d) apply to the administration orders of the above companies
granted on November 19, 2002.
Under the system of administration, the directors, shareholders or a
creditor of a company may apply to the appropriate court for the appointment of
an administrator (a licensed insolvency practitioner), in order to preserve the
company's business and assets in the event that the company is unable, or likely
to become unable, to pay its debts in full as they become due.
If the application for an administrator is approved by the court, the
administrator is appointed to take control of the company's affairs, and has a
wide range of powers (specified in the Insolvency Act 1986) to manage the
company's affairs. During administration, creditors of the company are
prohibited from taking any action to enforce claims, collect debts, or obtain
repayments from the company. No steps may be taken to enforce any security
interests on the company's property or to repossess goods in the company's
possession (unless consent is granted by the administrator or the court).
The administrator is also charged with developing a "statement of
proposals," or a plan for achieving the purposes of the administration as set
out in the first paragraph of this section. The administrator has three months
to formulate the statement of proposals, though this period may be extended at
the court's discretion.
Once a plan is formulated, a meeting of the company's creditors is held at
which the creditors vote on the statement of proposals, with the weight of each
creditor's vote directly proportional to the size of its debt. A simple majority
is required to adopt the statement of proposals. A creditors committee is also
formed at this meeting, which assists the administrator in discharging his
functions. A report on the meeting, together with the statement of proposals,
has to be filed with the court and with the Registrar of Companies. It is
anticipated that such a meeting with respect to TXU Europe will take place in
London in early January 2003.
If the statement of proposals is not approved, or fails to meet its stated
objectives (a key component of the plan), the company may face liquidation.
FURTHER INFORMATION
Certain documents are available for inspection at the Royal Courts of
Justice, 180 The Strand, London, WC2A 2LL.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
TXU EUROPE LIMITED
By: /s/ Henry Davies
----------------------------
Henry Davies
Principal Accounting Officer
Date: December 6, 2002