Background
Metallgesellschaft AG, or MG, is a German conglomerate, owned largely by Deutsche Bank AG, the
Dresdner Bank AG, Daimler-Benz, Allianz, and the Kuwait Investment Authority. MG, a traditional
metal company, has evolved in the last four years into a provider of risk management services. They
have several subsidiaries in its "Energy Group", with MG Refining and Marketing Inc. (MGRW) in
charge of refining and marketing petroleum products in the U.S.[1] In December, 1993, it was
revealed publicly that the "Energy Group" was responsible for losses of approximately $1.5 billion.
MGRM's expanded venture into the derivatives world began in 1991 with the hiring of Mr. Arthur
Benson from Louis Dreyfus Energy. It was Benson's strategy that eventually contributed to the
massive cash flow crisis that MG experienced.