NIX, PATTERSON & ROACH, L.L.P. Announces Class Period for Shareholder Class Action Suit

Business Wire, Oct 18, 2002

Business Editors & Legal Writers

LUFKIN, Texas--(BUSINESS WIRE)--Oct. 18, 2002

A class action has been commenced today in the United States District Court for the EASTERN DISTRICT OF TEXAS, LUFKIN DIVISION on behalf of purchasers of TXU Corp. ("TXU") (NYSE:TXU) publicly traded securities during the period between April 25, 2002 and October 11, 2002 (the "Class Period").

The complaint charges TXU and certain of its officers and directors with violations of the Securities Exchange Act of 1934. TXU provides electric and natural gas services, merchant energy trading, energy marketing, telecommunications and energy-related services. The complaint alleges that during the Class Period, defendants represented that the Company could succeed in the competition created by deregulation. Defendants then represented that TXU's European operations were improving, it would succeed competition in the U.K. market and it was on track to report EPS of $4.35 and $4.60 in 2002 and 2003, respectively. As a result of these allegedly false statements, TXU's stock traded at artificially inflated levels, as high as $56 per share.

Due to this inflation, defendants were able to complete a secondary offering of 11.8 million shares of common stock, priced at $51.15 per share and 8.8 million units of FELINE PRIDES (equity linked debt securities), raising nearly a billion dollars in much needed financing. Subsequent to the offering, defendants needed to maintain a high stock price to avoid triggering additional debt and the conversion of preferred stock into common stock pursuant to a partnership agreement.

On 10/4/02, TXU issued an earnings warning, indicating that due to customer attrition and ongoing problems in Europe the Company would report 2002 EPS of only $3.25. On this news, the Company's stock price declined to $27 per share, from more than $40 per share the prior week. However, the stock continued to be inflated as defendants concealed the extreme liquidity problems from which the Company was suffering. Defendants even assured the market that the Company was strong financially and that the dividend was "sound and secure." Then, on 10/14/02, before the market opened, TXU stunned the market with news that it was cutting its dividend 80%, to $0.125 per share and would no longer support its European operations. The Company's stock price immediately collapsed on this news to as low as $10.10 per share before closing at $12.94, a one day drop of 31%, on volume of 39 million shares.

If you purchased TXU securities between between April 25, 2002 and October 11, 2002, inclusive, you may, no later than December 16, 2002, request the Court appoint you as lead plaintiff.

If you wish to discuss this action or have any questions concerning this notice or your rights or interests with respect to these matters, please contact NIX, PATTERSON & ROACH, L.L.P., at the following address and/or number:

NIX, PATTERSON & ROACH, L.L.P.
BRAD BECKWORTH
205 Linda Drive
Daingerfield, Texas 75638
903/645-7333 (ext. 221)
903/645-4415 (fax)
bbeckworth@nixlawfirm.com (e-mail)