NEW YORK (AP) -- A federal bankruptcy judge Friday approved a plan to revive Enron Corp.'s flagship energy trading operation under the control of a Swiss investment bank.
UBS Warburg, a division of Switzerland's UBS AG, won't pay anything for the Enron division or assume any debt, but Enron and its creditors will get a third of the new operation's pretax profits.
Judge Arthur Gonzalez told a courtroom packed with lawyers the sale would be in the "best interest" of the company. He called it "the only mechanism to maintain value for the whole sales trading business."
Under the deal with UBS Warburg, Enron and its creditors could get more than $2 billion in royalties and other payments if UBS Warburg eventually exercises a buyout option. Restructuring expert Steven Zelin said earlier that the trading operation's value, if liquidated, would be "substantially less" than $50 million.
"We're pleased by the court's decision and we look forward to re-establishing the business," said David Walker, a spokesman for UBS Warburg.
He said executives hoped to get the business running soon, but could not provide a time frame. Lawyers for Enron had predicted the new division could be operating within two months.
No decision has been made on a new name for the division, but Walker said the Enron name would disappear.
Enron spokesman Mark Palmer called the judge's approval of the plan "great news."
"It is a key step in our reorganization of the company so that we can begin to make our creditors whole, pay our employees and hopefully one day soon come out of bankruptcy," Palmer said.
Earlier, Enron lawyer Martin Beinenstock said the deal would save jobs and "literally create billions of dollars for this estate and its creditors."
He downplayed claims by some creditors that Enron traders who will work for the new operation will use their knowledge of the company's existing trading positions for their benefit.
About 800 people work in the division. Many will be part of the new operation, but Walker would not give a precise figure.
Enron collapsed late last year amid revelations of complex partnerships used to keep billions of dollars in debt off its books and mask financial problems so it could continue to get cash and credit to run the trading business.
Under the deal approved Friday, Enron and its creditors will initially get 33 percent of the new business' pretax profits and UBS Warburg the remainder.
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