InterNorth
| Company type | Public |
|---|---|
| Industry | Energy |
| Predecessor | Northern Natural Gas Company |
| Founded | 1931 |
| Fate | Merged and renamed Enron Corporation in 1986 |
| Headquarters | Omaha , United States |
Area served | North America |
| Products | Natural gas pipelines, plastics manufacturing, coal, petroleum exploration |
InterNorth Inc. was a prominent energy company based in the Northern Natural Gas Building located in Omaha, Nebraska. Its core operations included managing natural gas pipelines along with activities in plastics manufacturing, coal, and petroleum exploration. This company served as a forerunner to the later Enron Corporation.
Originally established in 1931 under the name Northern Natural Gas Company, InterNorth broadened its scope through several acquisitions such as Northern Liquid Fuels, Northern Petrochemicals, Northern Propane Gas, Northern Border Pipeline, and People's Natural Gas. By March 1980, Northern Natural Gas restructured itself into a holding entity named InterNorth, overseeing the largest natural gas pipeline system in North America, spanning approximately 36,000 miles.
During 1980 and 1981, InterNorth initiated an unsolicited bid to acquire Crouse-Hinds Company, though the target was eventually purchased by Cooper Industries. The company continued its growth by purchasing Belco Petroleum Company in 1983, a Fortune 500 firm specializing in oil exploration and development and founded by Arthur Belfer. In 1985, InterNorth agreed to take over rival Houston Natural Gas (HNG) in a transaction perceived by some as excessively costly; this move functioned as a poison pill strategy to deter arbitrage.
After acquiring HNG, InterNorth adopted the name HNG/Internorth for a period of nine months before rebranding as Enron Corp. in April 1986. Although the merger was designed to preserve InterNorth’s autonomy with dual headquarters and CEO Samuel Segnar at the helm, operations soon consolidated in Houston under HNG’s CEO Ken Lay. Initially, Lay preferred the name Enteron due to its favorable implications but changed it to Enron following negative market reactions linked to its medical associations.
The combined company encountered challenges from corporate raider Irwin Jacobs. To address this threat, Lay secured more than $400 million from the employee stock ownership program (ESOP) to buy back Jacobs’ shares and reinforce Enron's financial position. Subsequently, Lay imposed a seven-year freeze on the ESOP, allowing withdrawals only upon retirement or death.
Northern Natural Gas remained InterNorth’s most significant asset and ranked among North America’s leading natural gas distributors. Following Enron’s collapse, Northern Natural Gas briefly became part of Dynegy Corp., headed by former Northern president Daniel Dienstbier. Dynegy eventually sold Northern to Warren Buffett's Berkshire Hathaway, which relocated its headquarters back to Omaha.